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How do you prepare your home-based Massage business for tax season?

I’m getting ready to open my home-based business in a couple weeks and I’m looking for advice on how to prepare my receipts for taxes. Because the business name is my name only, I only have to file yearly on my personal taxes. I’ve been told to use manila folders or an accordian file folder to keep things in order. How do you do it?

doesn’t matter how you keep the receipts, shoe box, folders whatever is convenient to you
the important thing is your recording which needs to be also convenient and easy to use
you can use a spread sheet type layout, you can use a columnar pad that is in a binder, and each month is represented by side by side pages
you name each column for the subject of the source, ie. income, rent, supplies, etc
and then when you have those totals for the month add to the next month in the year to date column so that by the end of the year, you have your totals handy without having to go thru everything again


3 Responses to “How do you prepare your home-based Massage business for tax season?”

  1. J-10 says:

    Look into some bookkeeping software, such as QuickBooks, or even basic personal finance software like Microsoft Money or Quicken to track your income and expenses from the business. If you have your taxes prepared by someone else, and you walk in with a folder full of receipts, you’re either going to (a) end up having to summarize everything yourself, or (b), walk out with an inflated bill.

    Personal finance software is pretty simple to use, requires no knowledge of accounting (just basic checkbook skills), and will help you generate reports to summarize the activity. You should still keep the receipts as audit proof if selected.
    References :

  2. tro says:

    doesn’t matter how you keep the receipts, shoe box, folders whatever is convenient to you
    the important thing is your recording which needs to be also convenient and easy to use
    you can use a spread sheet type layout, you can use a columnar pad that is in a binder, and each month is represented by side by side pages
    you name each column for the subject of the source, ie. income, rent, supplies, etc
    and then when you have those totals for the month add to the next month in the year to date column so that by the end of the year, you have your totals handy without having to go thru everything again
    References :

  3. Judy says:

    You’d be wise to talk to a tax professional first to see what records to keep.

    Keep very good records of all of your income and of any associated expenses (supplies, for example). Keep receipts for expenses. Accordian files with a slot for each month work well, things aren’t as likely to fall out and get lost as with manila folders.

    For the income, probably the easiest is a receipt book from an office supply store that makes two copies, one that you tear out and give to the customer, one that stays in the book for you.

    If you’re going to owe over $1000 total federal tax when you file your annual return, you are required to file quarterly estimated returns and send in tax money with those. If you have state or local income tax where you live, you might have to make quarterly payments there also.
    References :