Tax time is extremely stressful for most small business owners.  This is due usually to a last-minute rush to try and find the necessary paperwork needed by your tax accountant or CPA, in order to finalize and file your small business tax return.

There is an easier way to avoid the stress of tax season.  Know what exactly your accountant needs in order to do his or her job properly and get those items together ahead of time.

There are a couple reasons to have your items together before visiting your tax preparer:

  1. You save time, which is money, by not trying to piece together information with multiple trips back and forth to your tax preparer’s office.
  2. Your tax preparer is allowed more time to find all the deductions possible because your detailed records are available immediately.
  3. Your information is all together in one place which makes retrieval in case of an audit much easier and faster, saving you money, time, and a great deal of stress.

Now, what sort of information will you need to provide your tax preparer at tax time?  Here is a list of items you should have ready and available for your tax preparer on your first meeting during tax season. (Depending on your business, this list may not be all inclusive, but it’s a good start.)

  1. All 1099 and 1096 forms including INT, DIV, B and MISC.
  2. Any W-2 or W-3 information on you or your business
  3. 1098 forms which lists mortgage interest and property tax
  4. Schedule K-1 (income/loss from S Corps, Partnerships, Trusts etc.)
  5. Bank statements and reconciliation reports from the end of the taxable year and the beginning of the current year.
  6. A backup copy of your personal accounting software
  7. Petty Cash reconciliation
  8. Mileage on all vehicles
  9. Payroll reports from software or third party payroll company
  10. Information and statements from stocks, bonds or other investment transactions including dates of purchase and cost basis or date of sale and the selling price.
  11. List of Inventory and Assets
  12. Quarterly tax forms if used to report on a quarterly basis
  13. Statements pertaining to any real estate transactions including refinancing or foreclosure
  14. Balance sheet, profit and loss statement and trial balance for end of year
  15. Withdrawal and Investment information on partners or shareholders from the company account.
  16. Any documentation specific to your business not listed above.  This may include home based business expenses not mentioned above.

This list is, by no means comprehensive and many tax preparers have an actual list of documents they will need in order to prepare your taxes. The items listed above are merely for reference so that you can have a good majority of your documents together in one place.  This way you’ll be able to easily sort through your paperwork and bring exactly what you will need to your accountant’s office when the time comes.

There are many reasons to keep your documents together, but none more important than making sure your accountant has adequate time to find the most deductions possible for your small business.  Don’t let a sloppy record keeping system cheat you out of your hard earned money!