The earlier you assess your business year, bookkeeping, and record keeping, the more likely you can enjoy a relaxed holiday season and financially sound new year. Here are three moves to make before ringing in 2018.
Focus on Potential Tax Breaks
Managing your financial records is critical throughout the year, but those records need even more attention at year-end. If you haven’t been keeping good records during the year, organize what you do have and then comb your memory (and sort through those piles of receipts) for other deductible outlays you’ve made throughout the year — whether they are travel and entertainment expenses, business insurance, vehicle depreciation, lease payments, industry conferences — even dry cleaning while on the road for business.
Keep in mind that capital expenditures and the business portion of certain personal expenses, like your mobile phone bill, may figure into lowering your tax bill. If you manufacture or sell products, you may be able to deduct expenses for things like storage, freight, and labor used in figuring your cost of goods sold.
It’s likely well worth your time to investigate the list of potentially deductible items, including continuing professional education, web design, debt collection, group health insurance, postage, and franchise taxes, to name a few.
Write or Review Your Business Plan
Personal New Year’s resolutions may fall by the wayside, but your business needs resolutions that you can stick to. If you already have a business plan, this is a good time to review and update it. And if you’re operating without a plan, it’s important to develop a solid strategy for 2018.
Tend to Your Records and Budget
Avoid starting the new year with old paperwork burdens. Disorganized books, late tax payments, and missed 1099 or W-2 filings not only can infuse your business with a sense of chaos, they may well hit your bottom line.
Catch up on record keeping and get up to date on accounts receivable and payable. Make sure you’ve sent out invoices and tracked income and expenses, and prepare to meet January deadlines for sending out employee and contractor tax forms. And, if you don’t use cloud-based accounting software yet, consider making that move now to ease your record keeping and improve efficiency.
Finally, if you haven’t done it yet, assess your finances and nail down your 2018 budget. Your business plan can derail quickly if you don’t have the cash to support operations and expansion goals.