5 Ways to Get Organized for Tax Season

     This is a great, simple list to help you get started on organizing for tax season!  You may think you have lots of time between then and now, but once January hits, that's when your time starts flying.  This offers great advice on how to work with your accountant (hint #3) as well as plan ahead for your business by looking back.



5 Ways to Get Organized for Tax Season
Start getting organized now in order to minimize the headache of filing.

Tax season officially runs from January 1 through April 15. But calendar deadlines are deceptive. Face it: Tax preparation is a 12-month activity requiring discipline, organization and data, according to accountants and professional organizers.

Fortunately, it’s never too late or too early to set up a system for tracking tax records, receipts and other paper work. Here are five tips for organizing your taxes.

1. Mental exercise: Tax preparation begins with mental preparation. “The first place to organize is our minds,” said Rivka Gerecht Caroline, a professional organizer with So Be Organized. Make a tax date by marking your calendar with specific times for starting the process. Build momentum by establishing a schedule for organizing records.

If you feel overwhelmed, break the process down into small steps, said Standolyn Robertson, past president of the National Association of Professional Organizers and owner of Things In Place. And remember to book time for a mental vacation, with reserved space for a hobby, sports event or a spa date as a reward for completing the process. This tax incentive will help you override procrastination, Caroline said.

2. Set up a system: Tax records can be collected in a variety of files, ranging from a shoe box to one of several electronic filing systems, Robertson said. Whether you select low-tech or high-tech tax preparation tools, it’s important to maintain a system for storing receipts and other paperwork.

“At the first of every year, set up a large envelope or folder titled with the ‘current year’ and start accumulating tax-related income and expense information during the year as you go along,” said Carol Sokolow, a certified public accountant based in Miami. Key documents include receipts and credit card slips for business expenses, major purchases, charitable donations and other notable transactions.

“Then at tax time throw all year-end statements in the same envelope or folder. You will be ready to prepare the return or meet with your tax preparer. Organizing will not be such a daunting task at tax time,” Sokolow said.

3. Do your homework: Get the most out of tax consultation sessions by doing your own grunt work. “You should use your accountant to prepare your taxes, not organize your paper work,” Robertson said. To make the process painless, she recommends sorting through receipts and other paper work while watching television or listening to music.

[Visit the U.S. News My Money blog for the best money advice from around the web.]

4. Review the past: Use past tax returns as guides for the current tax season. “Last year’s taxes can be a checklist of what to look for this year,” Robertson said. If you hire a tax professional or a bookkeeper, request a checklist or a packet of tax preparation tips. There are also several places online where you can download tax preparation checklists.

5. Check your credit score: Prepare for a tax refund or a tax bill by requesting a copy of your credit report. A review of your credit history will help you set priorities for paying down debt and improving your credit score, said John Branham, a spokesman for TransUnion Interactive, a credit report service. “Understanding their credit situation now can help consumers create a plan to best use their refund or prepare to pay their tax bill,” Branham said.

Sharon Harvey-Rosenberg is a member of Wise Bread’s top personal finance blog network. She is the author of "Frugal Duchess: How to Live Well and Save Money” and a contributing author to ”10,001 Ways to Live Large on a Small Budget.”

To view the original article visit USNews.com.

Black Friday & Tax Deductions for Your Business

Black Friday is here, and with it a very crazy shopping season. You may be spending quite a bit of money on different gifts but one of the biggest selling categories during this season is electronic devices such as computers, tablets and smartphones.

When you are making your purchases this season, think of what are some of the things you could purchase for your office or work. Big ticket items like electronics, sometimes cost hundreds of dollars and could hold a tax write off. However, you need to be careful if you use these items for personal use since this could potentially get you in trouble with the IRS if you claim them as a deduction.

We found an excellent article by Entrepreneur magazine that details what consists personal use since this can sometimes be a gray area.

Some of the highlights from the article include:

"Tax Write-Off: Cell Phone Bill

If you use a cell phone as part of your business, this could be a big deduction for you. So don't make the mistake of mixing business with pleasure by sneaking too many personal calls onto your cell phone bill.


* Expert Opinion: "Because of the way a cell phone can be used, it's come under scrutiny, so people need to keep good records and keep their actual telephone bill so they can demonstrate that a majority of the calls were business calls,"

 * How to Do It Right: Take a look at your cell phone bill to make sure you receive an itemized report. Because cell phones are considered listed property, you need to keep detailed records of their use. In the case of a land line, it's a good idea to have a separate phone number for your business since the IRS won't let you allocate the cost of a single phone in your home to your home office.

Tax Write-Off: Home Office Computer


It's not a good idea to mix your business world with your personal life. So experts recommend never using your home office computer for personal tasks if you can help it.

* Expert Opinion: "If this is the only computer in your house, you'll have to calculate the percentage of total time you use it for business purposes,"

* How to Do It Right: Ideally, your best option is to purchase a laptop and dedicate it to being your personal computer. This way you can avoid any messy situations come audit time."

In other words, it’s never really a good idea to mix personal use of electronics when it comes to taking them as a tax deduction, but if you choose to get something with the intention of using it exclusively for work then by all means we encourage you to save some money this Black Friday and hopefully get a nice deduction once tax time comes around.


For more tips and tricks don’t forget to visit
www.AccountingWorksSolutions.com
or give us a call at
(804) 915-7040


To read the full article from Entrepreneur Magazine click here 

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Most of my clients come to me for accounting purposes and guidance, but what I do is so much more than that. I familiarize myself with current tax laws, manage payroll, expenses and income and finally and most importantly, I build relationships. I am no the kind of business manager that steps away from a client once we have an account, instead we build connections and friendships. I don’t do this because I have to but I do this because I like to.

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Accounting Works Solutions has worked very hard to make itself a successful business and I have such an amazing team behind me that it was almost impossible to fail, however as any business owner knows it’s still hard out there. So, I would like to offer my knowledge on best accounting practices, tips & tricks and just general updates so you can keep yourself in the loop of the latest trends and news when it comes to managing your business efficiently. As always we are here for you in case you ever have a question or need guidance, I hope you all enjoy our blog!

-Stephen

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