For small business owners, tax time can be onerous and and down-right dreadful. Even for those who use the services of a CPA Firm, business owners can spend countless hours on the “preparation” of tax preparation (documentation assemble, record-keeping).
The big question is: How can this time spent be avoided? Clean your books (and keep them clean!)
It is critical that you are thorough throughout the year in regards to keeping clean books and meticulous record-keeping. All too often, our accountants discover (especially at this time of year) bookkeeping errors that could have been avoided; Errors that can prove to be costly for the small business owner at tax time and beyond.
What are some of the most common bookkeeping mistakes made by small business owners?
- Not saving receipts of less than $75.
- Doing it yourself. No matter how much they hate it, many small business owners insist upon handling the books themselves.
- Forgetting to track reimbursable expenses.
- Not properly classifying employees.
- Lack of communication.
- Not reconciling the books with the bank statement each month.
- No Backup.
- Not deducting sales tax.
- Petty cash nonchalance.
- Miscategorization or overcategorization.
Davis & Hodgdon Associates CPAs has been assisting individuals, businesses, and nonprofits with tax, accounting, and financial planning services in the Burlington Vermont Metro area for more than 20 years. If you have any questions or concerns please feel free to call 802.878.1963 or email [email protected].