Tidy up your books for tax season and benefit all year and beyond
If only tax preparation could ‘spark joy’ for business owners. More likely, it’s creeping dread you’ve felt since the turn of the year as the nearing tax deadline – and growing pile of receipts, bills and statements you have to face down to meet it – remind you the books aren’t in the shape you’d hoped this time last year.
Take heart! It’s never too late to tidy up those books. Read on to get in the right frame of mind to knock it out now and set yourself up for a better year.
“The most challenging lesson I’ve learned is reporting the numbers: numbers for me are just like ‘number salad.’ My Ignite 360 team has really helped me with creating a dashboard. It’s just what I needed as an entrepreneur. It really helped me strategize at a higher level.”
— Janice Cathey, Founder and Owner, Ha.Lé Mind & Body
Narrow Your Focus
That you’re reading this post suggests your bookkeeping can stand to improve. But trouble spots can find even the tidiest book keepers. Everyone can benefit from looking back at how you managed and organized your accounting over the last year.
But you don’t have to fix it all at once. Asking yourself the following questions will help you determine where to focus your efforts:
- Are you losing money, or feel there is money you can’t track ?
- Do you feel like you’re wasting time whenever you deal with accounting tasks?
- Are you anxious about tax season, worrying you’re at risk for reporting something incorrectly to the IRS?
- Are you having difficulty paying bills?
Play To Your Strengths
Chances are your accounting mess got that way because you weren’t sure how to organize it from the start. There’s no shame in that – we certainly aren’t all born accountants, and you likely didn’t start a business hoping to become one.
Successful business owners know what they’re good at and hire accordingly. Hiring a professional to help you is a sure way to get on the right track and stay there.
Think an accountant isn’t worth the price? Consider the cost of the time you spend trying to wrangle the mess on your own and the focus it may be robbing from other parts of your business or future plans.
Tools Are Your Friends
If you manage any part of your accounting manually, it’s time to look for software tools.
Businesses of any size or industry today can choose from a wealth of software to find the right mix of tools for their needs. The most basic options record your expenses, receipts, and income all in one place. More advanced options can handle payroll and financial reporting or integrate with your bank accounts to reconcile dollars in and out.
If you aren’t sure what you need, start small and keep an eye on what tasks still cost you time and money – this will help you decide if and when you need to upgrade.
Reconcile on a Schedule
Matching every dollar that comes into your business with every dollar out takes discipline and a set schedule to make sure nothing falls through the cracks. For some businesses, that needs to happen weekly, while others work well monthly.
Make sure you set the right schedule for your business. You’ll now you’ve got it right if you’re not letting anything pile up, you aren’t losing money, and you’re prepared for tax season.
Staying organized will help you avoid a jumble of numbers and accounts that never feel properly managed. For Janice Cathey, her integrative care center Ha.Lé Mind and Body thrived from the mentorship she received at Pathway. The “number salad” that was her accounting headache transformed into organized dashboards that Pathway mentors helped put in place.
Mentors Make It Manageable
If you’re looking for more help in organizing your accounting processes, consider joining our Ignite 360 mentorship program. As a mentee, you’ll gain access to mentors in Nashville who can guide you through business decisions based on their own expertise, including how to get your books in order.
Not every hat you wear as a business owner will bring you joy. But, tidying up the books will bring you peace of mind. Once you can develop an accounting process that works for you, you’ll know you’re avoiding possible hiccups in tax and financial reporting, and you’ll be maximizing profits to boot. Best of all, you’ll get time back to spend on the parts of the business that do bring you joy. Make this year one for the books.