By Lahle Wolfe. Women in Business Expert
Lahle A. Wolfe, a single mom of four, is an entrepreneur, author, speaker, web programmer and application developer. She is founder and CEO of LA Wolfe Marketing and its two subsidiaries. Wolfe has extensive experience in both the nonprofit and for-profit business world. Read more
Organizing expenses receipts can save you money on business income taxes. Sounds too simple, but the truth is most people are not very organized when it comes to filing receipts and keeping records updated for tax purposes.
Here are four reasons you should start organizing information for next years' tax returns, and how organizing receipts can save you money:
- You Will Do Your Taxes Sooner: Filing taxes on time can save you money because you will not have to pay penalties for filing late. You are more likely to keep putting off preparing your taxes if you do not have everything right on front of you. No one likes digging for receipts, and there is always that nagging feeling that some receipts are missing and the temptation to put off filing to give yourself more time
to find missing receipts is great. Read "Three Time Saving Tips for Handling Business Receipts" to get some quick tips for organizing your receipts.
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- You Will Save Money. For every expense receipt you cannot find, you will pay more in tax dollars. Many business expenses are tax deductible - for every one you miss, you pay more on income. Estimating an expenses you remember only works if you do not get audited. If you ever get audited you must have the receipt to prove the expense. Read, "Ordinary and Necessary Tax Deductible Business Expenses" to see if you are taking all the deductions allowed for a home office business.
- You Will Get A Refund Sooner: Yes, it does happen sometimes. Sole proprietors, for example, pay taxes for their business and personal income on the same return. If you overpaid and are due a refund, the sooner you file your return, the sooner you will get your refund. Before you consider one of those "advance refund" services, read, "Income Tax Refund Anticipation Loans" to avoid getting ripped off.