4 Small Business Tax Accounting Tips for the Work-at-Home Mom

If you are lucky enough to run your business from home, you may feel you are too busy for many small business tax accounting requirements. The double roles of mother and business owner can take up the vast majority of your time, and finally getting around to your accounting needs often does not happen until the very last minute. Try these tips to keep the process simple and alleviate stress come April.

#1 Find a Good Adviser

The first thing you will need to learn as a business owner and mother is simple: you have to ask for help. As simple as this may seem, though, many entrepreneurial mothers cannot follow through with this step. They have a "do it yourself" attitude, making them great business owners but often overworked. Before you even start your business, form a relationship with an adviser you can trust. If you want only limited help, then seek someone who can provide limited help. You will benefit from getting answers to your questions from the start, helping you plan throughout the year instead of waiting until the last minute.

#2 Automate the Process

Once you have your plan, do everything you can do to automate your accounting and tax files. For example, set up spreadsheets on your work computer that will track each of your expenses. This will include mileage, insurance payments, costs directly related to the product you produce and all your home office expenses. Home office expenses, since you operate out of your house, can include utility payments, rent or mortgage. Only a portion of these costs will be deductible, but you can find that portion later. For now, just make sure you are keeping track as you go, automating as much as possible.

#3 Simplify with "Business Only" Options

When you mix personal and business expenses, things can become more complicated. Simplify this part for yourself. Set up accounts that are used only for business expenses. Then, when you need to locate a receipt, you will know exactly which account the expenses came from. If you have the luxury of owning more than one car, designate one of your cars as a business-only vehicle. Then, any expenses related with that vehicle can be deducted. The same goes for a home office. If you have a dedicated office, close it off to other purposes. If you do these things, all of your accounting will be segregated for you.

#4 Look for Clever Deductions

Just because you do not think you need an assistant or child care helper does not mean it would be unwise to have one. If you can pay a child care professional a small amount per hour, you could dedicate the time to your business. You can often pay pre-tax dollars toward child care if you work full-time. Do you have a cleaning person who cleans your home and your office? You can deduct the portion of money you pay her or him to clean your office. Do not miss out on these opportunities just because your full-time job is at home.

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