No one likes tax season, but unfortunately, you can’t ignore it altogether. And if that was your plan for this year, you could be looking at quite a hefty tax bill. But don’t worry, if you’ve been a bit negligent with your bookkeeping, all is not lost. There are still steps you can take to avoid owing the IRS all of your profits.
Just find the area that best describes the state of your books and we’ll tell you how to proceed.
I was pretty good at my bookkeeping, but the last few months I’ve really let it go.
Depending on your business type, if your books aren’t too far gone, you can still potentially make the deadline this year. If not, filing an extension* is easy and will save you from having to pay penalties if you owe any money. Since you’ve been on top of your books most of the year, you understand the value of knowing what’s going on in your business. It shouldn’t take a bookkeeper too long to get you back on track. Also, it might be time to think about getting a full-time bookkeeper so these slip ups don’t happen again.
My New Year’s Resolution was to be better at my books, I made it to mid-year.
Six months behind isn’t the end of the world. But you’re not making that deadline. File an extension* asap so you can breathe easy. Also, you’re probably going to want to hand those 6 months over to a bookkeeper so you can have the full financial picture of what’s going on in your business. While they’re at it, you may want to ask them if your financials allow you to hire a bookkeeper. While you can continue doing your own books, it seems like you may have more important things to worry about. Outsource what you find tedious so you can spend time on the areas of your business you enjoy.
My books? I remember seeing them sometime last spring.
Not a fan of bookkeeping, huh? We get that. But the harsh reality is, you’re behind. Filing an extension* is the first thing on the list. An accountant or bookkeeper can help you with this if you’re unsure how to handle it yourself. The next order of business is going to be getting your books in state that you can hand them over to a CPA or to get the numbers you’ll need to input into your tax software. There are two options here, you can pay to get your books done for the last year, or you can get a summary of your revenues and allowable expenses. The difference is, doing a full reconciliation will give you a clear picture of what was going on in your business so you’ll have further insight into what you can improve. A summary will give you what you need for your taxes, but no real insight, but it will be a cheaper fix for right now. That being said, we strongly recommend finding a bookkeeper to help handle your day-to-day books so you can unlock the value of your financial information, and help prevent you from ending up in this position next year.
What is this bookkeeping you speak of?
It’s clear you like living on the edge, and while we respect that, the IRS most certainly won’t. You’re too far gone to ever hope of getting your taxes in on time this year (no offense). Your first order of business is to file an extension*. If you don’t know how to do that, contact an accountant or bookkeeper for help. Also, since you’re going to need 12 months of bookkeeping, you have some options. If money is an issue, we recommend you work with someone who will just give you a summary of your revenue and allowable expenses for the year. However, this won’t really help you understand your business. If you want more insight, you can get your whole year’s worth of financials reconciled and cleaned up. Also, you should probably make sure this doesn’t happen again next year. Find a way to get your bookkeeping done that makes sense for your business. Because your current plan probably isn’t sustainable and will end up costing you more in the long run.
No matter how far gone you are, we can help. Contact us today for a free consultation and we’ll help get you IRS-ready.
* Please understand when filing for an extension, you may need to pay estimated taxes to the IRS until you complete your final taxes.
BookKeeping Express does not provide tax or legal advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax or legal advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.