I'm Jessica Lauren - a wedding photographer for happy couples who are stoked about their wedding day! I couldn't be more thrilled that you stopped by! This is where I share bits and pieces of my passionate heart, spontaneous adventures, and pretty pictures of my rad clients! Feel free to grab a cup of coffee and stay awhile! xoxo

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February 1, 2018

How I Prepared for Tax Season :: St. Louis Photographer

How I Prepared for Tax Season

Let me start this post by saying this – I am NOT a tax expert. If you want professional, legal, expert tax advice – I would 10/10 recommend hiring an accountant! However, I had posted on Instagram last week about how stoked I was to be done with taxes for the year and I got a TON of questions about what I do! So I figured it wouldn’t hurt to put together a blog post on how I prepared for tax season – but keep in mind that I am just a small business owner who is doing everything I can to be organized and somewhat put together in the finance and tax department. ;) None of this is too revolutionary!

That being said, ever since I started my business, taxes have been a bit of a burden for me. And to this day, they still aren’t my favorite things in the world. However, they don’t intimidate me like they used to! There are a few things I’ve learned that help me keep my sanity and not feel like the world is ending come tax season. My hope is that, similarly, they will help you feel like you’re in control of your taxes instead of them controlling you.

A foundational part of me keeping all of my finances in order is having a completely separate bank account for my business. This allows me to keep everything organized – I never spend any money personally out of my business account – only business purchases come out of that account and only business income goes in. This gives me the freedom to keep a tight eye on my finances without muddling everything with personal expenses.

However, what I believe is the BIGGEST key to helping me stay on top of the back end of my business are monthly duty days. Once a month I schedule a day where I focus on tidying up the financial end of my business.

Things that happen on monthly duty day include some of the following:

  • Categorize my income & expenses in Quickbooks (I collect all payment through my client management system, Honeybook, which I can’t recommend enough – and payments go directly into my bank account, and simultaneously directly into Quickbooks.)
  •  Talk to your accountant if you have questions on how you should organize things. A few little things I do are the following: write the name of who made what payment in the memo, go into each income transaction and factor in the credit card fee, and for expenses – I try to attach a picture of the receipt, especially if it’s a big purchase. I’m usually good about doing this the first part of the year. But I won’t lie – as soon as busy fall season hits, I have a tendency to fall off the wagon. Ha!)
  • Once everything is categorized properly, I print off my bank statement and reconcile it in Quickbooks to make sure everything in inputted properly.
    I don’t have a *ton* of taxable income (for sales tax), but for the tangible products I sell, I keep a google doc record monthly of the amount of tax that was paid and on what.
  • Categorizing mileage is a HUGE thing part of my monthly duty day! I am *not* a paper calendar girl, and I put everything on my calendar on my phone/computer. I also put EVERYTHING I do on my calendar so I can remember where I was going on what day! MileIQ tracks my mileage throughout the month (it’s $60 a year and one of the best investments ever!), and on monthly duty day I go through my calendar and my app and categorize each of my drives.
  • This is also a day where I write myself a paycheck and look through my finance, I make sure I’m putting money in appropriate places for savings, retirement, my quarterly taxes, etc.
  • If it’s a month where quarterly taxes are due, I make sure I’m paying in enough and write checks to my state and the IRS.
    Last but not least, I gather all of my receipts. My business receipts always go in the center console of my car – because I’m almost always on the go and don’t want to lose them! It really helps to have a “place” for things, instead of throwing random receipts in your purse and wondering where the heck they are later.

This may seem like a LOT of things, but truthfully if you’re diligent it can be done in one afternoon and then you’re done! And honestly, it’s the most relieving and exciting feeling when you feel like you are on top of your game.

Once January comes around after a new year, I send out 1099’s to any subcontractors I paid over $600 (second shooters, editors, etc), gather all my bank statements, print out a yearly mileage record, gather charitable contribution statements, 1099-INT forms, and I’m pretty much set! Taxes look different for everyone depending on if you’re married, have kids, own a house, etc. But I can guarantee that if you implement a disciplined system with how you handle and keep track of your finances, when tax season rolls around you will feel like a NEW person!

Nothing in my system is magical, it’s simply just taking a few days a year to organize and keep track of a few things.

I hope this is helpful as you head into a new tax season! ;)

Much love,

Jessica Lauren

PS – Here’s an overview of my favorite programs! If you click the link provided you can get 50% off Honeybook, and 20% off of MileIQ!! I don’t have any discounts for Quickbooks but I basically wouldn’t have a brain without it – so I would highly recommend!!

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