It’s tax season! Yay?!
Really it is good thing because you can take the time to review your profit and expenses and set business goals for 2007. If you are a micro-business owner who will be filing a Schedule C on your 1040, then you can analyze business expense accounts and make adjustments to your Chart of Accounts as necessary. The Chart of Accounts is to a business’ financial picture as a table of contents is to book. Use your Charts of Accounts as Vitamin C and it will prevents errors in recording your income and expenses. I recommend printing a blank copy of a 1040 form with the Schedule C and then printing out a copy of your current Chart of Accounts. Then you can “map” accounts, which means to assign what taxable expenses that will properly correspond to your business’ Chart of Accounts. If you don’t have the expense, that’s OK. Only include expense categories that you think that you will incur in the near future. You can add accounts in Quickbooks, but you cannot delete them. [They can only be made inactive.] As you perform this exercise, you will get a picture of how your business operates numbers-wise. That is a cool thing!