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5 Tip for a Stress-Free Tax Time
March 13, 2020
Ready for a stress free tax time?
Do the words tax time cause anxiety and fear to rise up in you? I know many people really hate the idea of taxes and all the HARD (real or perceived) work that goes into preparing for them. I believe tax time can be stress free and anxiety free. Read further to find some ways to make that happen.
- “Don’t put off till tomorrow what can be done today.” Make it a habit to record income and expenses on a weekly basis. It doesn't matter what method you use. It can be an accounting system, excel spreadsheet, or even a notebook. Just make sure that you keep a detailed account of income and expenses
- “Technology is amazing. Allow the use of it to truly make your life simpler.” Use an accounting system to be the MOST stress free at tax time. It really doesn’t matter which one. They all have the same basic abilities and each have their pros and cons. Just pick one and then learn how to use it well.
- “Routine check ups are good for more than just your physical body.” Taking a bit of time at the beginning of each month to look back over the previous month’s numbers will do several things. It will give you peace of mind that everything is taken care of and all numbers are correct and accounted for. It will help you to know what’s happening in your business. This only takes a little bit of time and creates such a peace of mind knowing you can close the door to that month’s books.
- “The magic is in the details” When recording your expenses be over detailed rather than under. Account the expense to the correct category and then add a description of what it actually was. Some things are cut and dried. Rent is rent is rent. But there are other things that are beneficial to make sure you have more details. Example. Repairs and maintenance is a broad category. I would advise you to describe the work that was done or the item that was bought. Then when more details are needed they are readily available and the receipts don’t need to be dug out of the archives somewhere.
- “Hire someone to do the thing that isn’t in your wheelhouse.” Do numbers actually make your eyes glaze over and your brain shut down? For some people it’s more than not liking the numbers. They really don’t understand them. If that is you, please do yourself and your tax accountant a favor and hire someone that excels in numbers and in making them pretty and simple to do the work for you. The brain space that you free by having someone else do these things for you will be more than worth the expense. In fact, I see hiring a bookkeeper as an investment.
And since I was having so much fun with these tips here is an extra tip to make your Tuesday extra Tipsy!
6. “Two things are definite in life taxes and death.” Plan for taxes in your budget. A business is for profit therefore if you truly have a business you WILL pay some taxes. Just plan for it. Then it doesn’t hurt so much!! As a business owner set aside money in a separate account for taxes and DO NOT TOUCH it except to pay taxes. Pay those quarterly taxes and get a refund just like everyone else instead of dreading the amount of money that will be owed at the end of the year.
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