Being prepared for tax season is part of life for the business professional but let’s face it, there are not many people on the face of this planet that legitimately enjoy prepping to pay their business taxes. There are plenty of people who spend tax time sifting through piles and piles of paper, hoping that they’ve found everything or hoping that their tax professional doesn’t hate them after they bring in a shoebox stacked with papers. Small businesses are labor-intensive enough without having to keep track of all of the paperwork that comes with it, but that’s no excuse! When you get a solid organizational system put into place, you can rest assured that you’ll breeze through every tax season with very little hassle.
- Know the Laws
Laws vary by state, knowing the laws in your area is an important first step in getting prepared to organize your business paperwork. Sometimes knowing the local laws get tricky so having a team in your back pocket that can help you to make sense of them is really important. The people making up this team should include a registered agent, tax professional, your accountant, and a lawyer. Perhaps you’ve been unknowingly saving an unimportant document and it is taking up a lot of room, or worse, you’ve not been saving something that you should be– you wouldn’t know unless someone told you!
- Clear That Desk
Most professionals have a messy spot- where papers just accumulate and continue piling up. It happens so easily, in the morning it’s a cleaned off desk and then throughout the day papers just get laid down. Clearing off your workspace will not just spruce up the office, it will clear your mind so that you are able to focus on exactly the way you need to organize the piles of paperwork. Clearing the clutter ensures that as papers come in, they are placed somewhere that they will actually be found at a later time. Ensuring that papers are placed in a filing center right away will save so much time searching for them later in the month.
- Dedicate Space
Once your desk is cleared off, it is time to dedicate a space for filing. It needs to be out of the way but intentional, so that you know when you enter that space, you recognize that you will be putting documents where they belong. Dedicating a space for random papers that is not your desk is life-changing– but you need to be careful here! You don’t want somewhere else to become a pile of papers that your desk used to be. A filing cabinet or drawer equipped with filing folders are the perfect locations!
- Tracking Forms
Are there events that happen frequently in your business? Maybe something that happens a few times a week– can you remember every single time in the last month that this event took place? Probably not. Business professionals are not super-humans– that’s why tracking forms need a place in your organizational system. Tracking forms can be as unique as you need them to be, a farm may need to know how often they watered in the month of June and for how long, a law office would need to know specific court dates and details. No matter what your business is, make sure you track it!
- Acquiring the Proper Materials
Organizational materials are a huge business! Planners, file folders, binders, staplers, sticky notes, accordion folders– you cannot organize your documents unless you have the proper materials! So, sit down and think about what you need to get those files in an easy-to-understand order. If you have a hard time with scheduling, get a planner, if you have a hard time putting things away, an accordion folder is a good start. Expect to buy
- Archiving
Banking boxes are the perfect archival system. It’s very important each year that you do not get rid of the previous years’ records. However, you don’t want those records sitting around and piling up (remember all the clutter we just got rid of?). Sticking the entire year into banking boxes and storing them in a separate location– under the stairs, in a closet– somewhere that you have access to them. In fact, the IRS recommends keeping documents anywhere from three to seven years.
- Work on It Daily
Take a moment and decide what time of the day you can commit fifteen minutes to appropriately file paperwork. Have you ever heard the phrase, “there’s a place for everything and everything in its place”? That phrase should ring in your head every single time you think of putting a newly acquired document away incorrectly. If you can commit just this small amount of time into your working day, before heading home, to sorting through documents, filing, and taking notes, you will be 100% prepared to pay your business taxes without hassle.
- Make It a Habit
The organization is a habitual behavior. Actually, Psychology Today says that developing new habits are often times harder than breaking old ones. This is why perhaps the most difficult aspect of any new system is actually sticking to it! It doesn’t do you any good to put forth the effort to get organized if a month or two down the road you’re back in the same position and need to get back on track. So, take that fifteen minutes per day– set a reminder– and commit to it!
Tax time doesn’t need to equate to stress time. With very little upfront effort, you could sail through paying your business taxes and focus on the parts of a business that you actually enjoy. It’s simple, in order to organize, first, you need to clear the clutter and find a new space. Acquire the proper materials to file paperwork, add in some business tracking forms, and make sure you know the legal and archival requirements for your business.
Finally, stick to it! You have to make organizing a habit and habits require some upfront discipline– however, once it is all said and done, you can rest easy knowing that you’re on top of it.
