Running a business is apparently not a big deal for many, but at the same time it can lead to a lot of problems if not handled with care. Amongst all other things that need to be dealt with, it’s the business expenses that actually call for maximum attention from you as the owner. Expenses are something that can easily slip out of hand if you don’t handle it with extra care. Paying attention to very minute detail is necessary here and this can actually get a little tedious after a certain point of time. It’s always worthwhile to have complete and accurate records for it’ll ultimately pay you with time, for instance during tax season you’ll be saved all the last minute scramble and worry.
Strategies for Keeping Track of Business Expenses
If you’re getting bogged down with the entire idea of having to keep track of business expenses, then here are a few simple yet effectual strategies that are going to help you in the process.
1. Maintain a Business Expense Log : The very first step to simplifying the whole process requires you to maintain a business log. If you really want to make it basic, then go to a nearby office supply store and purchase a log book for keeps. A 12 section accordion file folder should do. This book should have a section for mileage and another for receipts. Make sure that you keep filing each month’s paper receipts in the accordion file. If you’re not interested in keeping the hassle of a book, then you could also make use of a software program. Choose from the ones that are available and you’re sure to find one that suits your needs.
2. Keep Filling in the Amounts : You see maintaining a log book simply won’t do. You need to maintain it religiously and for that end you should keep filling in the amounts in the book. You can also make use of the mileage chart and start filling in the mileage. Collect store receipts and keep it in the section designated for it. If there is fax sheets involved, then put them in the right slot of the accordion file for the month in which it’s used. Entering all relevant information in the software program you’re using is also important.
3. Calculate the Total Every Month : It’s not just about keeping a tab of the expenses or storing the receipts and faxes only. You should also take care to calculate the respective total at the end of each month. This process should be continued for the rest of the year. When using a software program, you can take out a printout of the totals involved.
4. Run a Check of IRS (Internal Revenue Service) Allowances : When you’re nearing the time for filing a tax return, then take care to run a check of the IRS allowances for mileage or any other deductions that might be applicable. You can take the aid of your tax preparer in doing so.
Following the 4 strategies discussed above should definitely help get your business expenses in order for good.