1 Simple Thing You Should Do For Your Bookkeeping
Open a Bank Account
So what’s the one simple thing you can do right now you ask, are you ready for this? It’s pretty simple. You’re to open a separate bank account. If you are opening a Business Bank Account, the bank will require you to have a DBA or registered LLC or tax ID or EIN. [You can find information on Tax ID and EIN, DBAs and LLCs, and Business Structure with these links]
Separate Bank Account for Business
If you’re not at a place to register a DBA or LLC or obtain a Tax ID yet, all you need to do is set up a separate bank account. This can be a bank account with your name and social security number (a personal account) that you’re going to use only for business transactions. Even if you have to deposit a little bit of your own cash into this account to get things rolling, this is going to make your life so much easier.
How Does a Separate Bank Account Help?
When you open a separate account you will have everything running through one account. So at the very least, bare minimum, at tax time you can go to this bank, log in, download the activity into a CSV file, sort that out in Excel or Google sheets with your income and expenses and have what you need to file taxes pretty done quickly.
Integrate and Automate Your Bank Account
You can start using QuickBooks online. You can easily connect this bank account with QuickBooks online and start pulling transactions right into the software and categorizing them to the appropriate income and expense accounts so that you actually have a profit and loss statement and a balance sheet. You could look at this profit and loss monthly to see how your business is growing, to see what your expenses are, to see how much money is coming in or where it’s going out. And then at the end of the year, you can pull a profit and loss for the entire year to file taxes with a click of a button.
Pro Tip: I know sometimes getting started with the business might require a little bit of an investment and maybe a little bit of debt. If you’re going to use a credit card to fund your business at all even if it’s a personal card, you need to have one dedicated to just business transactions.
Whether that’s opening a business credit card, great, or opening a personal card that you’re going to use just for business or taking one you already have, paying it off and starting fresh and using it only for business, you can do the same thing. You can then go to that credit card website, download the transactions into Excel or Google, sort them out for tax time. Or you can even connect that credit card to QuickBooks online to categorize everything and add to that profit and loss statement so that you have a full set of books.
I know these are kind of simple things, but they truly will make a world of difference because now you have everything flowing and you can actually start putting it together. You can stop spending hours going through all of your personal accounts, highlighting or taking out the things that are personal versus what’s business.
Now you have a place to get started to finally get control of your bookkeeping once and for all. You can grab more support and resources for your creative business in my community, #CreateMore with Tiffany. Every Friday, you can grab my LIVE Coaching Call on topic just like this! If you are ready to get your financial sh!t together and makeover your creative business bookkeeping, book a call with me here!