TAX DAY IS A JOY!
By Vanessa I Farrell, MPH, MCHES
When I started my business, I didn’t know what I didn’t know. I struggled with properly managing and accurately accounting for the money that flowed in and out of my business. Despite having the QuickBooks software and opening a business account at the outset of setting up my business to avoid commingling funds - it was a struggle.
This murkiness made my tax preparation a royal nightmare.
It would take me weeks and hours away from my business to gather and categorize all my receipts and expenses in the good old Excel spreadsheet to present them to my accountant.
With a long-term vision of entrepreneurship, I knew that this method of accounting was unsustainable. So two years in, I reached out to Dr. Ranelli Williams of ERJ for help. I needed help understanding basic accounting principles related to my business. I needed to understand better how to maximize my QuickBooks subscription, and most importantly, I wanted to better understand how to prepare myself for tax season.
She offered me a consultation of 3 one-hour sessions, and the price point made me say W.H.A.T???
At first, I was hesitant to spend that amount of money and needed to pray on this one, and I did. I got my answer, and 3 days later, I followed up to let her know that I was on board and ready to move forward.
The three sessions provided me with a clear understanding of how to effectively categorize my spending, as well as how I would reconcile my expenses on a monthly basis. I also learned how to create the necessary reports within QuickBooks and what I need to share with my accountant for tax purposes.
The time spent with Dr. Williams was a game-changer for my understanding of the bookkeeping aspects of my business. I got a personalized step-by-step tangible game plan to approach my finances.
Tax season has become a joy - and I actually look forward to it. This time-consuming chore that took me weeks to complete with tons of unpaid hours (not good for a new entrepreneur that needs to make money to keep business afloat) has been minimized to as little as five minutes or less each year. What I do now is to -
Categorize all my business expenses within QuickBooks
Reconcile my accounts on a monthly basis.
Use my business account only for business-related items
Do not commingle business and personal funds
Pay myself using owner draws
Establish a profit account
Invest in my retirement plan (this is called an SEP, which is like a 401(k) for the self-employed person)
Keep up with my estimated tax payment.
To prepare to file my taxes in January, I simply select my profit and loss report within the QuickBooks system and email it to my accountant to prepare my taxes. That’s it!
It may have been a huge sacrifice, but I can say without a doubt it’s one of the best investments I have ever made in my business, not to mention my sanity.
Did I mention that tax season is a JOY! Thank you, Dr. Ranelli Williams of ERJ !
If you are struggling with your bookkeeping or just need to experience JOY during tax season, contact her TODAY.
