Tis the season to gear up for tax time! Making sure your books are organized and accurate before your accountant sees them will save you time and money. Preparing your books for your tax returns doesn’t have to be a chore if you get started now.
First of all, check your reports to be sure that all transactions are recorded in the right accounts. Accounting software is a fabulous tool, but it can be easy to click the wrong category, customer or account when posting expenses, bills and payments. Correct any posting errors you find.
Make sure you’ve been receiving payments properly. Instead of just making deposits, apply payments to customer invoices individually to ensure open invoice balances are correct.
Consider purchases and sales. Did you buy any new office equipment like computers or phone systems? Did you sell any old equipment like vehicles that depreciate? Make sure your accountant knows.
Supply the right documents. Every business is different, but here’s a basic list of what your accountant may need to file your taxes:
- Copies of your business checking and savings account statements for December of last year.
- End of year balances and interest paid last year on loans and lines of credit.
- Documentation for any new loans you acquired during the previous year.
- Inventory value as of December 31st of the previous year.
- Relevant tax forms such as W3, 1096, 1099K, 940, 941 and state withholding reports.
- Monthly sales tax reports for the previous year.
- Portable accounting software files.
- Corporate documents such as annual meeting minutes.
- Income, expenses and property tax information.
Remember to bring your information to your accountant as soon as possible. This is a busy time of year and many firms have a long list of clients. Allow at least six weeks before the filing deadline, or you may end up having to file an extension.
Need help? Contact us at Reconciled and find out how our online bookkeeping and accounting services can free you up to do what you do best.