Wednesday, December 7, 2011

Wrap Up Tax Details Now!

As we close in on the end of the year, it's a very busy time for most of us. Holidays with the family, religious celebrations, company parties and seasonal voiceover work keeps us very busy this time of year! It's so easy to forget the most important task of the month, which is closing out our tax year!

As a voiceover artist (and small business owner), there are quite a few things that you should have available to make your tax filing as seamless as possible. December 31st is ideally YOUR deadline to get organized for your tax filing. By taking a little time and getting yourself organized now, you can save yourself loads of money! We've put together this article to try to help make your tax filing as easy as possible.

If you have your very own CPA, this makes things much easier, as they can advise you on all things tax related. For some of us, we don't have a CPA to rely on throughout the year and are left to our own devices to muddle through and learn from our mistakes. It may be worth it to you to have an accountant on hand just for year-end advice, particularly when it comes to your business operations. You need to have a good understanding of your financial situation when it comes to your business. An accountant can be particularly helpful with this, especially around this time of year. It can be a great asset to have when planning your strategy for the new year.

Everyone has different opinions on this, but we recommend to collect on your outstanding accounts before the end of the year, purely for organizational purposes. It's fairly common knowledge by all business owners that companies want to collect on their accounts by end of year to balance their books and prepare for tax season. We all have those clients (you know the ones I'm talking about) that drag their feet paying you. Chances are if they typically drag their feet, they will this time of year as well. So make sure you give your clients a few weeks to get their past due invoices caught up. Feel free to send them a reminder every week if necessary. Some people recommend collecting past due payments during the first week of January, to defer that income to the new year. However, once you begin this habit, it's a hard habit to break. You'll always be rolling over income from the previous year into the new year and that can be a logistical nightmare when trying to keep your books organized.

You should get all of your deductions organized and categorized. The general guideline is to try to spend whatever profit you made for the entire year. You should have been saving all of your receipts and categorizing all of your deductions throughout the entire year. Business deductions include such items as: new headphones, software, client luncheons, training seminars and much, much more!

Have you just been stuffing all of your receipts in a file folder hoping that inevitable day will never come? Well, my friend, the day has come to take them all out and get them organized, so get to it! Also, if you know that you'll be needing goods or services in the first quarter of the new year, now is the time to buy them (if cash flow permits, of course). Stock up on office supplies, pay your bills early, purchase that new office chair you've been eyeing!

Plan for your distant future while helping your immediate future with retirement plans! You can also reduce your claimed income by either setting up or contributing to a retirement fund. Check the contribution limits for your type of plan. In the U.S.: 401(k), KEOGH plan, Roth IRA, or SEP's. (For SIMPLE IRA's the deadline is set in October, too late for year-end tax planning.) This is another topic that would be great to discuss with an accountant.

Taking the time to get organized now will give you time at the end of the month to wrap up any loose ends and focus on more important things this time of year (like enjoying the holidays with your children and family)!

NOTE: This article was not written by a certified CPA or tax preparer. Please check with your personal accountant or tax preparer on all rules and regulations when making all decisions for the tax season.

Written by:
Bethany Baker
Such A Voice Marketing Director

No comments:

Post a Comment