Begin by labeling your folders. Common sections of your file folder may include:
- Pending Orders (Orders that are in the process of being shipped, completed, etc.)
- Paid Orders (Orders/Services that are completed and paid for)
- Bills Due (Invoices for items the company owes)
- Banking Information (includes Bank Statements)
- Receipts/Bills Paid (All other expenses that don’t fall into the 5 categories below)
- Vehicle Information (Mileage Logs, Vehicle Maintenance Receipts, Licensing Fees)
- Insurance
- Charitable Contributions
- Advertising
- Fixed Assets (Any receipts for equipment, furniture, computers, etc that can be depreciated)
- Miscellaneous (For anything you just are not sure of!)
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- Advertising
- Bank Fees on Business Accounts
- Business Vehicle Expenses
- Commissions & Fees
- Cost of Products
- Gifts to customers, suppliers, etc.
- Depreciation
- Dues for Trade Associations, Business-related organizations
- Legal & Professional Services
- 50% of Meals & Entertainment (be sure to note date, purpose, & attendees of event)
- Office Expenses
- Travel Expenses
- Rent
- Utilities
- Services performed by Independent contractors
By utilizing this simple tool, it will not only keep you organized but it will save you precious time when Tax Season rolls around.
Review your Pending Orders folder monthly to ensure your orders are being completed and moved to Paid Orders in a timely manner. The Bills Due section of your file folder should be reviewed twice monthly to ensure payments are being made on-time. Here is a list of common business deductions to aid you in organizing your receipts: