Friday, January 16, 2009

5 Easy Tips to Get Your Tax Preparer to Love You :)

I have been filing my business taxes for 3-4 years now and along the way...I have learned a few things :) Today I thought I'd share with you the things I have learned that make your tax preparer love you!
Tip 1: Keep all your receipts...but not in a shoebox!
I have a file cabinet just for my business documents. I keep all of my receipts and invoices in files separated by year. (ie. Costs 2008)
Tip 2: Do not bring this file to your tax preparer!
What do tax preparers hate the most...a year's worth of receipts! I keep all of my costs and sales in Excel Spreadsheets in chronological order. This is very easy to do and just takes a little updating throughout the year. I print them and bring them along with me to my appointment.
Tip 3: Make your Excel documents work for you.
I organize my Cost Log into 7 categories: Date, Company (purchased from), Inventory, Supplies, Utilities, Internet, Fees. I use these specific categories for different reasons. Your categories should work for your specific business. I have a separate room in my house for my business, so I am able to write off part of my home's expenses...therefore I have the Utilities section. Also, I use the Internet specifically for my business, so I am able to write off the entire bill for this. If I had a separate phone line, I would be able to write this off as well. Figure out what sections you need and make them work for you. Add categories as needed...this is the first year I have added Fees to my Cost Log. I put my Etsy fees and shipping fees in this category.
Tip 4: File your sales tax quarterly.
This tip is more for your benefit than for your tax preparers, but it will help everyone out in the end :) By filing your taxes 4 times per year, this forces you to organize your income at least that often. It will leave you less to do at the end of the year :) And if you have to open your Excel document and organize your income...why not do your costs as well! This is my first year selling on Etsy, so I added these sales to the bottom of my Sales Log to show their income. I didn't want them added into my quarterly sections because I did not charge sales tax on them. (out of state)
Tip 5: Have everything with you when you meet with your preparer.
This will save you the time of meeting multiple times and making more work for your preparer. I always schedule my appointment for early to mid-February. This way I am sure that I have received all of my needed paper work. (W-2s, tax forms, credit card statements with last year's costs, etc.)
Follow these tips and you will be in and out in about 20-30 minutes and you will leave your tax preparer with a smile on his/her face :)
Do you have a good tax prep tip? Leave me a comment...I'd love to know :)


  1. Wow! Those are great tips! I'll definitely be keeping some of those in mind!

  2. I am so thankful that you said "Do not bring this file to your tax preparer"! We do not like to see receipts or lots of files that we have to sort through and add up all the income or expenses. Those returns are put in a pile where they sit until we absolutely have to get to it!

    Your tips are fantastic and you are the model client!

  3. edi - those are great tips, and you wrote a wonderful carnival post! Thanks so much for the tips - I love the idea of an Excel spreadsheet (instead of my Quicken listing) - I've never used Excel before.....

  4. Great tips! Thanks for sharing! Is your business LLC?

  5. OH and dont you wanna share that Excel spreadsheet..Sounds like a great tool! :)

  6. Thanks for this great post! Very helpful tips!!

  7. This is fabulous. Thanks.
    I'm going to bookmark it so I can remind myself what I need to do.

  8. Great tips! Thank you so much. I've been stressing and dealing with some anxiety about tax season already! Your post really helped calm me :)

  9. I'm a certified tax preparer for H&R Block (though I took time off to work at home with my Jewelry business. :D) With our small business specialists and our tax preparers who do tackle itemization and such, we don't require people to bring receipt for expenses. if people bring them, we don't really take a look at them. Tax preparers trust their clients and I think receipts only come into play, for many places, if you get audited by the IRS and have to proof expenses.

  10. What a great post! Thank you. I love filing quarterly for the reason you listed but I am not good about keeping up with expenses. I do have them neatly filed but I have to do something with them. Too bad there isn't a magic little receipt fairy...


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