How Starting Your Own Business Can Be Easier When Following These Six Tips.

By Zach Allred

Starting your own business can be a very rewarding experience. You will enjoy freedom and flexibility you never imagined. You will also work harder than you ever have before but it feels completely different when you are working for yourself. Here are some tips to help you get off on the right foot with your record keeping.

1. Keep receipts for all transactions. Pay for everything with a check, debit card or credit card. This will simplify your record keeping. A receipt and your bank or credit card record provide adequate documentation to fulfill the IRS's guidelines.

2. Avoid Cash. I can tell you the easiest way to get into hot water with the IRS is to pay for things with cash and then not have a receipt. For many of us we are in a habit of using cash from the time we were kids. For your own business though, you need to avoid cash.

3. Deposit All Your Income. It is very tempting to withhold cash from your business receipts but I advise you not to. Instead, be aggressive with your expenses. If you are in an industry where cash deals are common the IRS will look for evidence of cash deposits in your checking account. If they are absent you will have a lot of questions to answer.

4. Get QuickBooks. I have to recommend Quickbooks to you as an accounting software. It is a complete package and you will be up and running in no time. It is designed to emulate the look and feel of your check register. This makes it easy to start using.

5. File Quarterly Payroll Reports. There are many services that will file your employee payroll reports. Look in your local yellow pages. Another option is to learn to do them yourself. Either way do not get behind because penalties for late payment of employee taxes are severe.

6. Use A Business Credit Card. Using a business credit card has many benefits. You can usually find one with no annual fee, 0% introductory interest rate and even cash rewards. But for the purpose of this article one of the primary benefits is for your record keeping. At the end of the year you will receive a summary of all your expenses by category. Give this to your accountant along with your other records at tax time. This will make your accountant's job easier which should lower his/her fees.

These suggestions are just the beginning and you would be wise to seek the help of a qualified tax accountant as soon as you can. Often times you can get an initial consultation to get many of your questions answered. Talk to a few different ones and try to find one you has experience with your particular business.

Article Source: http://interpret.zar.vg

About The Author
Zach Allred is a tax preparer with 20 years experience. Click Small Business Taxes and subscribe to his complimentary monthly tax newsletter. Also click on Home Business to read other complimentary articles.