Working on the taxes for our businesses the past 10 years has taught me a lot. For some reason though I dread the tax preparation every year, but once I get started I’m fired up! I do an Income VS Expense Excel spreadsheet for our Accountant and from what he’s told me he wishes every client did the same.
This year I’m polishing my record keeping to make it easier on myself next year. I use Quicken and categorize everything, but I think I’m going to get a little more specific. For instance: any income that’s deposited in our farm account goes under the category “farm income.” Now I’m going to divide that category into sub categories to include: grain sales, freezer meat sales, hay sales, and rental income. By doing that it will save me time calculating the categories next year.
My Farmer and I decided to start paying the boys to work on the farm this year, because up until now they have helped without getting paid. So it’s time to set up time cards and to track their work hours. Once they turn in their time cards they will get paid. This will be a great learning experience about money, savings for their future, and not to mention a tax deduction for the farm books. It’s all a win/win situation! Love it!
Another to key to small business bookkeeping is having separate bank accounts for the various businesses. For instance we have an account for our concrete business, and account for the farm, an obviously our personal accounts. By separating those business account transactions it makes for easier bookkeeping of income and expenses.
What are your tips for small business bookkeeping?
