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Bookkeeping Is A Skill-Set You Should Know!

Don’t memorize anything that can be looked up, especially when its constantly changing.

Don’t memorize anything that can be looked up, especially when its constantly changing.

People need a good process for their bookkeeping systems and one step further are two bullet point areas we’re going to delve into:

-Chart of accounts

-Payroll Processes

This information is one layer deeper into bookkeeping systems. Having a good bookkeeping system in place is the first step and now chart of accounts with in those bookkeeping systems is what we will go line by line through

This information is meant to help sustain bullet proofing your records and allowing you to write off as many expenses as legally possible.

It is also meant to assist you in literally naming the expenses in the chart of accounts of your business in correct terms to lower the risk of an audit.

One of the first areas to set a strong foundation in is the software system you are going to use but more importantly the chart of accounts that you are going to use to keep your records reconciled, organized, and charted well so that you have accurate easily accessible records and are ready to turn them over during tax filing dead lines.

This will save you both time and money as once the systems are in place its just a matter of maintaining them going forward.

Different businesses have different expenditures but most businesses have the main deductible expenses and expense categories to deal with.

When you hear things like – I heard you can write of an airplane or I heard I can write off the business use of my home, or I heard I can write off foreign travel it all has to be in context and the most accurate way to track things is with a specific chart of accounts with correct labeling of the categories your expenses will be titled.

This information has been reviewed with CPA’s, a tax attorney, and the IRS how ever you should insist that your local counsel verify it for you, this is meant as information to help your current wealth team implement a solid chart of accounts.

End Result is You’ll be able to work ON YOUR business – meaning go out and make money with the systems in place to support your deductions.

I have had a lot of students ask me specific code sections and really what is most important if you were to take anything away from this dialog is that really your chart of accounts with your tax diary is the two pieces of ammunition that you want if an audit were to ever happen to you, or other unforeseen events such as death of a business partner, death of a spouse, divorce, illness, disability, etc…

A good chart of accounts backed by a good bookkeeper who understands how to decipher your spending habits is a valuable tool to have in your tool box in other words be prepared.

*Note some restrictions apply to qualifying for certain deductions.

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