Importance of records when it comes to taxes.

Bookkeeping and record keeping is important for both individuals and business. In today’s world this is a very simple task and can save you hours in the long run. Whether you decide to use QuickBooks, Microsoft Excel, or on paper they will all get the same job done.

For businesses bookkeeping is the foundation for accounting as a whole. Bookkeeping shows you where every dollar came from and where every dollar was spent. This is a necessity when it comes to taxes. With good bookkeeping you will be able to find every dollar you spend on deductible expense for your business.

Record keeping isn't just for businesses it is just as important for individuals. Especially those that itemize their deductions saving receipts with sales tax are a must. Just have a central place to keep them all. I use a plastic filing cabinet; other options could include old shoe boxes or a drawer. To save you some time during tax season I would recommend every other month or so count all the sales tax up and write it down on a piece of paper and then paper clip the receipts you counted up. I use a Microsoft Excel spreadsheet to keep a running told of how much sales tax I paid. This is also a great way to see were you are stand with your deductions. If you need more itemized deductions consider donating some of your kid’s old toys or some old clothing around the house. Just remember to get a written statement from the charity showing the fair market value. You could even buy some deductible cookies for your family. Did I say deductible cookies what I meant to say is Girl Scout cookies. These are just a few of the many things that can help increase your deduction and lower your taxable income.

This article was written to make people aware of the importance of record keeping and to give them ideas on how to make it work for them. Enjoy.