Does this sound like you in March every year? Maybe even April if you really push it off?
You’re anxiously flipping through hundreds of papers and receipts trying to find a specific expense. Or maybe it’s trying to go through your drives, trying to remember exactly where you went every day for the past year.
That sounds exhausting. Is this happening late at night when your kids or spouse is already asleep, but you’re burning the midnight oil because you have to get your numbers figured out for your tax appointment coming up? You waited until the last minute to start prepping, and now you’re facing the repercussions of that.
What if instead, this could be a reality? It’s March and you already have your numbers calculated from the previous year. Your receipts are all organized in a folder and you just are waiting for your final few papers to come in the mail before meeting with your accountant. Your stress level is low and instead of being chained to your dining room table sifting through papers, you’re outside playing catch with your kids.
Wouldn’t you rather have the second scenario?
If you’re a new photographer, your main focus is likely to shoot as much as possible. But if you aren’t marketing yourself correctly, or you’re not setting your business up on a firm foundation, you may fall under the statistic that 80% of businesses don’t last past year three.
This is why I created a free guide that will walk you through 45 tasks to accomplish in your business in the first year, from marketing to camera skills and networking to workflows. This guide will help you set your business up for success, so you’re ready when the inquiries start rolling in.
It’s also why I want to share how you can automate your booking in order to spend just 5-10 minutes at a time working on your business numbers — so that you can enjoy that second scenario I mentioned.
Automate Your Accounting Software
The first way to automate your business finances is by using accounting software to automate income and expense tracking. This will cut down on the amount of manual tasks that you will need to do in your business to prep your numbers for tax season. An example of accounting software could be QuickBooks, or even some CRMs can allow you to do this process.
It will connect to your bank account and then start organizing your expenses to make it easy for you to categorize them based on the deduction category that they fall under. Some of them even will start learning where these different expenses fall and do it for you automatically. You can also run reports to total your numbers, so all you have to do is send it off to your accountant.
Automate Your Accounting Spreadsheet
On the other side, if you’re working with a spreadsheet instead of accounting software, you can still set up automation. You can create equations so that your income and expenses are totaled for each month. If you take it a step further, you can create equations to figure out your sales tax, so you always know what you’re going to need to pay, as well as break down the total for each tax deduction category.
This will streamline your process with your accountant or CPA and make it easy for you to send over the numbers they need to file your tax return.
Automate Your Bank Account
Another automation you can set up is through your bank account. Most banks allow you to create folders within your account so you can easily transfer and organize money.
Set up an automation that sets aside 30 percent of your income that comes into your account into a specific tax folder. This will make sure you’re covered for any payments you owe for sales tax, estimated tax, or your annual tax return. You won’t be panicked when the deadlines come around because you already have the money set aside.
Automate Your Mileage Tracking
Instead of manually logging each and every trip you make with your shoots (which is both time-consuming and easy to be full of errors), you can automate your mileage tracking.
MileIQ and Quickbooks both allow for this and will use GPS to capture the distance traveled, plus help you categorize the trips.
Never go back to putting addresses in Google Maps and cross-referencing your calendar again!
Automate Your Receipt Organization
Also, you can upload pictures of your receipts so that you’re automatically connecting your expenses with the receipt instead of trying to rummage through folders later on to find it if you need to prove it.
Setting up these automations allows you to confidently know you’re not missing anything and that you’re providing the correct numbers to your accountant or CPA. It also gives you the freedom to work on the things you love instead of constantly having to track your numbers to stay on top of things. Or worse, having to do it all at once right before taxes are due when you can’t quite remember everything and what it was for.
Create Routines
In addition to setting up automations, adding a weekly routine to organize additional tax-related numbers is crucial to saving time at the end of the year. In this weekly routine, you should make sure that you’re tracking and delegating your income into different buckets, such as that tax folder that I mentioned previously. Steal My Weekly Rhythm >>
You should also be tracking your expenses and organizing them based on those deduction categories. Staying on top of your personal versus business mileage is another weekly task you can do. As I mentioned, using MileIQ will track your mileage in the background so that all you have to do is swipe left or right depending on if it was a business or personal purpose.
In addition to that, paying sales tax or estimated taxes when it’s due can be a weekly routine task. And then lastly, make sure you’re tracking your independent contractors. Making a spreadsheet to know exactly who you paid each week and then overall in a year who you paid over 600 allows you to easily know who you need to send a W-9 to so that you can provide them with a 1099 for their tax return.
At the end of the day, it all comes down to simplifying your systems. Use one spreadsheet, utilize automations as much as possible, and create weekly rhythms for yourself and your tax season will become significantly smoother!
Have questions about ways to automate your business finances? Ask away in the comments below!
Few things make me more excited than getting the chance to help another photographer grow a thriving business. So, don’t forget to snag my 45 Goals for The First Year of Your Photography Business Guide.
Let’s Prep for Tax Season – Together
Make tracking your numbers easy with my Tax Prep Spreadsheet and ensure that tax season is a breeze.
Mastering your business taxes starts with understanding the different tax categories. Grab my free tax category guide to take the first step towards stress-free taxes today.
Want taxes to suck less? Learn how to correctly prepare your taxes for your accountant with the Photographer Tax Course – and say hello to a confident and calm tax season!
Don’t know what you don’t know? You’re just 90 minutes from a custom tax prep system with my 1:1 Tax Prep Mentoring sessions!
XOXO ~ Heather Marie
More Tax Tips for Photographers:
+ COMMENTS
add a comment