Are you relieved that tax season is over? Returns filed and receipts in hand, you feel like you can finally get back to running your small Nashville business without worrying about numbers for the IRS.
While that might be partly true, the fact of the matter is it’s never too soon to start preparing for the next time you file taxes. Accounting, after all, is part of daily operations.
Here are a few tips from your Nashville CPA to ensure your books – and business – will be in order right from the start of the new financial year.
Track your finances more efficiently
Let’s start with the basics: If you were all over the place heading into the last tax season, you should organize your files better starting now.
Did you rely too much on paper receipts, misplace a few, and suffer gaps in your records? Develop a digital back-up by taking photographs of every paper bill you send or receive. If you can, try to go paperless: send, receive, and manage all your paperwork through accounting software. Everyone involved in your business from yourself, to your clerk, and to your CPA can turn this to your advantage and convenience.
Are you still using the same debit or credit cards for your personal and small business transactions? You should separate those accounts to avoid not only confusing figures, but also mixing up funds.
Perhaps you’ve already taken care of these basic steps. In that case, you should use these tools to properly examine your finances and go further by heeding the following advice.
Re-evaluate your business goal and type
Accounting isn’t all about jotting figures in the right columns. A good entrepreneur steps back from time to time to analyze what the numbers mean.
Check your books from 2017. What do they tell you about your strengths? Which aspects do you need to improve? Are there sources of revenue you could develop further? Are there funds you could direct to better uses – like employee benefits or R&D projects? Your answers to such questions will undoubtedly affect both your daily operations and tax returns moving forward.
The numbers can also tell you whether you are poised for expansion or a scale-down – a move that would change your business structure and tax strategy. After all, only a proper evaluation will let you know: do you have enough funding or capital to keep going?
Review the latest tax reforms
Lastly, check what the tax bill passed in December 2017 could mean for your business. The changes it prescribes, which take effect in 2019, could change your approach to managing your finances this year. Consult with your Nashville CPA about how the reforms might affect you, and what strategies you can adopt in response.
As you should know, being proactive is key to a successful business; you can never prepare too early or too much for success.
4 Accounting Tips for 2018 You Can Use Immediately, INC.com
New Year’s Accounting Resolutions, Xero.com