It’s happened, somewhere between the fall colors, turkeys, and holiday travel, the days of 2014 have dwindled to just a few. Sadly, the next season is tax season, and it’s better to get organized now than wait for the eleventh hour. You likely made personal resolutions for 2015, so why not financial ones? Before you can start fresh, though, you’ve got to reconcile your accounts and expenses.
Overwhelmed? Don’t be. Just follow the five easy steps below, and you’ll hum right through tax season.
1. Reconcile your bank accounts for 2014 through December and make sure that all of your checks and debits have cleared. You will need this information for your estimated tax payment on January 15th and your sales tax payment due on January 31st. If you find one that’s gone rogue, no worries, you have plenty of time to follow up, remember? You’re ahead of the game.
2. Take a look at the vendors you’ve paid for services this year and make sure their information is complete and correct. You’ll need this for 1099s on January 31st.
3. Check back and see what kind of interest you paid on your credit cards and loans. It’s a detail that is often overlooked, but interest is a deductible expense. Hold onto this information too; you’ll need it before sending your books to your tax preparer.
4. Large balances are often red flags to the IRS. Dig out all those items that you filed as miscellaneous or in uncategorized accounts and move them into another expense account.
5. Review your travel, meals, and entertainment accounts to make sure it all adds up before you send it out.
See? Relax, exhale, and take it one step at a time. That’s all there is to it! And remember that if you need more time, just file an extension by March 15 if you’re a corporation and by April 15 if you’re a sole proprietor/partnership.
Need a cheat sheet? Keep track of these important dates:
• January 15: Estimated tax payment
• January 31: Sales tax payment
• March 15: Deadline to file an extension for corporations
• April 15: Deadline to file an extension for sole proprietor/partnership