First off, get yourself a program called Quick Books (available from the Barnes & Noble website via the GIF below), or something similar to help keep track of your business’s finances. We have found that these programs are an enormous help to young businesses run by people who are not very familiar with standard accounting and management procedures. ( We don’t get any money for endorsing Quick Books so our recommendation is based on our experience and preference, not financial incentive.)
Second, do not ever make the mistake of saying “I’ll take care of the books, taxes, etc. later–I’ve gotta build my business first.” A few simple actions at the beginning and regular bookkeeping will avoid enormous problems later on. People who start a business first and worry about the boring stuff, such as tax filings later, are sure to run into problems. This may seem like a no-brainer to most of you, but we have seen very bright millionaires who thought they could either outwit the IRS and state revenue departments or simply put off those boring tax rules for awhile. As you can imagine, the legal bills (and possible criminal penalties) associated with this attitude are debilitating to any business, let alone a small startup.
Please, please take care to file all necessary tax forms (local, state and federal) at the beginning. After that, keep your books and tax records up to date, this will help you avoid that tax-time crunch of trying to run your business while also re-creating a year’s worth of financial records from memory (by the way, it simply can’t be done, and you will lose money as a result).
We know that many (most?) of you do not know a deduction from a debit so we try to make these pages dealing with taxation as simple as possible. But if you do not understand something, or if you want more information, please let us know. We are in the process of revising the whole site and your input is very much wanted. Especially in an area like taxation which is a difficult subject for beginners.
Below is a list of topics for you to peruse. For people entirely new to tax and accounting, start from the beginning and work down the list.