1 Simple Thing You Should Do For Your Bookkeeping

by Sep 16, 2020Bookkeeping

Is your bookkeeping a hot mess? Does your bookkeeping even exist? Do you find yourself spending hours and hours going through paperwork and files and downloading transactions to put everything together for tax time, just to file each year? Today I’m going to share with you the ONE simple thing that you can do right now to start getting control of your bookkeeping. It’s going to make your life so much easier. So let’s dive in. 


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!


 <iframe src=”https://www.youtube.com/embed/kx4xpd0RFYM” width=”560″ height=”315″ frameborder=”0″ allowfullscreen=”allowfullscreen”></iframe>

You’ve probably heard of an Owner Draw and that term does get tossed around a lot. If you need a quick refresher Owner Draws, head here. But what is an Owner Contribution? You’ve actually probably made these before and quite possibly never even realized it. 

What is an Owner Contribution

Let’s first take a look at the definition of an Owner Contribution. It’s quite literally the exact opposite of an Owner Draw. An Owner Contribution is any time that you pay for business expenses with personal funds or transfer personal funds to a business bank account. So anytime you transfer money to cover other things from your personal to your business, that’s an Owner Contribution.

How Does an Owner Contribution Work

You may have done this when you first set up your bank account. Maybe you needed to transfer some cash in to open the account, but it came from personal funds. That’s an Owner Contribution. Owner Contribution increases the equity in your company just like an Owner Draw reduces the equity in your company.


How Do You Record an Owner Contribution

Let’s say that you’re at the store picking up a bunch of office supplies for your business, and you forgot your business bank card at home. It’s okay. Use your personal card and then go home and record that into your bookkeeping as an owner contribution, because you just spent personal money out of pocket on business expenses. This ensures that you still get the expense on your taxes, but that the money came from personal funds rather than the business bank account.


If you have a business credit card and maybe funds are tight, so you use personal cash to make a payment on it, that is an owner contribution as well because you’re taking personal out of pocket money to pay off a business balance or to pay expenses for the business.

Owner Contribution and Business Taxes

There is no real Business Tax unless you are a C Corporation. Everything for a Sole Proprietor, DBA, LLC, and S Corporation flow through to your personal tax return, making your personal taxes due or tax return, personal cash. If you deposit your tax refund to a business bank account, this is considered an Owner Contribution because that’s personal cash being put into a business bank account.

Were there any of these areas that surprised you? I’d love to hear. Now you have a place to get started to finally get control of your bookkeeping once and for all.

📷 Click here to join my free Facebook community Financially Focused Photographers
I go live in this community every week answering all your tax, bookkeeping, and tax questions!

Be sure to follow me on Instagram, Facebook, YouTube, and Pinterest.


– Tiffany Bastian

New Advanced Child Tax Credit Payments

New Advanced Child Tax Credit Payments

You may have heard some buzz around this new child tax credit, or maybe you’ve already received a deposit from the IRS.
In this blog post, we’ll go over everything you need to know about this new advanced credit. 

Hey Photographer!

Grab the Free Guide and Handle Sales Tax Like a Pro!

Pin It on Pinterest

Share This