Okay I Know Some Of You Are Getting Your Taxes Ready But..

[Lee]

What about next years taxes? Do you have everything organized to make next years filing easier than this years?

This is an article that was posted a few years ago on GWW and it has some really good information in it so i figured id repost it:

Bookkeeping For Adult Webmasters.

Knowing how much you are spending on expenses for your online enterprise each month can be a very powerful tool. Taking out that shoe box at the end of the year and giving it to the Accountant is one way. But a very simple bookkeeping system can provide you with exactly how much you made each month after all expenses. In this article I will provide you with the knowledge to setup a simple system to track your revenues and expenses. Not only will you then know exactly what your Net Income or Loss is each month but at the end of the year you will have a nice neat little package to hand your Accountant. Which will result in lower accounting fees at tax time.

The first thing you need to do is find a way to file all receipts. Your receipts are the backup for all your transactions. Go to your local office supply store and buy an accordion file labeled with monthly slots. Each time you receive a business related receipt, file in correct month. Remember you need to file all your receipts for your numbers to be accurate. When you receive an email receipt for content or hosting print it out and file it. File sponsor cheque stubs, credit card receipts, ISP bill, etc. At the end of each month take out all your receipts and divide into revenue and expenses. Remember you must have a receipt in order to claim the expense. The receipt should show the detail of the purchase, vendor, amounts and date. Ensure that the expenses are needed or used to generate revenue for your business.

Now the next step depends on how much detail you would like.
Revenue-Expenses=Net Income or Loss. For a quick snapshot of the month add up the revenue receipts, staple all receipts together and put the total on the front either adding machine tape or handwritten. Repeat with all your expense receipts. You can put a quick summary of the month in a spreadsheet program. Or for a very small investment you can setup a computerized tracking system. I recommend buying a very inexpensive software such as Quicken. Most major banks, credit cards and even paypal are setup to download transactions to Quicken. You can purchase the Personal Finance version of Quicken for around $70. There are several other inexpensive personal finance software packages that you can purchase that will work as just well. But I personally prefer Quicken. The software you choose will have a list of business accounts already setup. For an adult enterprise you will need to customize the account names. This is very easy and quick to do. Add in accounts for content purchase, hosting, isp, traffic purchase, etc.

Once a week you will open up your program download your transactions from your bank account, credit card, paypal etc. If you have an expense that you pay cash for you will need to add that transaction in. I am assuming that all your sponsor cheques are being deposited into a bank account or paypal. If you receive a check and cash it, manually add the transaction in. After you have finished entering your transactions for the week ensure that the receipts that you have balance to what you have entered in the software.

You will be amazed at how simple it is to use a software package such as Quicken to track your revenue and expenses. These software packages come with pre-made report tools. Such as income statement, analysis of expenditures, cash flow projections. You can even setup budget numbers for your business.

If your business consists of a lot of transactions in a month you might want to consider using a bookkeeping/accounting service. There are many online and locally owned businesses that charge a very low rate for doing small business bookkeeping. Remember you don’t need an Accountant to do general bookkeeping. Many small business owners think they need an Accountant to do the monthly bookkeeping. This could result in unnecessary fees. Depending on the size of your enterprise and your passion for numbers sometimes employing a bookkeeper to do the data entry can be a blessing! Most bookkeeping providers will even provide customized reporting based on your needs.

Article written by Lorna for:

http://www.gaywidewebmasters.com

Also, dont forget that while you are finishing up THIS years taxes, if you run in to any problems such as not being able to find something, not knowing where to report something or some other problem, be sure to make a note of it. That way, when next years tax period comes, you will already know what goes where, where things are kept and, more importantly, have a less stressfull tax season

Regards,

Lee

[maxpower]

OMG I am just about to start this years taxes, I do not even want to start thinking about next year at all. :cry: I have to go to bed L8