If you want to save money on your taxes it is of the utmost importance that you keep accurate records. And keeping good records will surely help you if you should ever be audited.
Record keeping does not have to take long. In fact you can keep accurate records in just 5 minutes a day.
Getting the largest possible deductions for your business need not be time consuming or hard.
Little deductions quickly add up to big tax savings. Make it a habit to consistently post your expenses and you will put money in your pocket!
Even small transactions should be recorded everyday. If you post to your Accounting Software daily you will find that it takes less than 5 minutes a day.
Use the following method you will be assured that all your receipts have been accounted for.
For any purchases online save your confirmation of purchase in a folder on your desktop called perhaps “Daily Receipts”
Any cash receipts you may have acquired during the day can be kept in a folder at your desk.
Every day (morning or night) post the receipt in the 2 files. Doing this daily takes only a couple of minutes.
Make a file in My Documents called “Tax Back Up Files”. File your daily online receipts in this folder.
The easiest way to keep your online receipts in order is to put them in a Tax Backup File in files labeled for each month.
Putting a backup on a DVD or CD monthly is a good habit to get into. Keep these backups with your year-end tax records.
For your “hard copy” receipts keep monthly envelops to file “posted” receipts in.
These receipts will be filed with your year-end tax records. Unless a problem arrives you will probably never have to deal with these receipts again.
Collecting receipts for everything that you do is a good habit to get into!
Over the year a lot of little deductions can cost you tax dollars! For instance did you go get copies for 50 cents and fail to post it in you accounting program. That’s lost tax dollars!
Regular and consistent record keeping will pay off for you at tax time guaranteed!
Tags: business deductions, business write off, deductions taxes, home business, home business tax deductions, home office taxes, Homebased Business, personal finance, tax savings