Filing Taxes Can Be Brutal. Here’s How to Make it a Little More Bearable
Taxes can be a founder’s own personal hell. Here’s how you can avoid unnecessary tax drama and even have fun doing it.
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A day pulling weeds in 100 degree weather. Baking 5,000 cupcakes and washing all dishes. Driving a U-Haul in rush hour through town. What do these have in common? They are among the many, many things I'd rather do than work on my taxes.
As a small business owner, taxes are a daily thought. Did I get an itemized receipt for that lunch meeting? Do I need a paper copy of this invoice? Total drag, right? I don't make new year's resolutions, but every year at midnight, April 15th, I vow to get take better care with my paperwork for the next year.
Here are five ways to make your tax time easier and maybe just a little fun:
1. Use software to make tax time a breeze.
Piles of receipts are a pain in the ass. Invest in desktop or cloud-based software that tracks expenses. I use a combination of Freshbooks and Mint to track my expenses making tax time a breeze.
These programs can pull data from your bank, credit, and loan accounts. Ideally, you'll log in every day or week to label your transactions. You can also do global search-and-replace to catch up on recurring transactions if, say, you forgot about all this until April 14. No judgment.
Using software to capture your receipts and track expenses will save you the unnecessary headache of digging through a mountain of paper come April.
2. Get a CPA to lighten the burden.
When I first started my business, I had a few nightmare weeks trying to file business taxes on my own and navigate a mess of paperwork. Get a CPA!
My accountant is enjoyable to deal with, and doesn't add unnecessary stress. Look for one who is a board certified CPA and has experience with tax situations similar to yours.
You don't need a Fortune 500 CPA you're a sole proprietor--and for a standard return, it won't break the bank. I don't dread tax phone calls because I've picked an accountant I enjoy talking to. Pick someone you enjoy dealing with and watch your stress dissipate.
If you really like doing your own taxes, have a pro check your work. Some CPAs will review your forms before you file and make corrections or suggest deductions you might be eligible to take.
Get on your CPA's calendar early. Call in January--even if it's just to schedule a time in April--and get ahead of the procrastinators.
3. Make a friendly wager to spice up your filings.
Have a tax season bracket among your friends or at your co-working space. Whoever files last has to buy coffee for everyone else. Whoever claims the most obscure deduction gets a donut.
Or use a commitment contract app like Stickk or Pact to wager on yourself about getting the filing done by a specific date.
4. Win at productivity by doing them in January.
You know that post-holiday slump that hits after Thanksgiving, Christmas, and New Year's? Have a last hurrah with last year's Christmas pajamas and settle in for a cozy night of reviewing receipts.
You don't have to file right away, but completing the forms early can highlight any missing paperwork you need to track down. Or maybe you'll surprise yourself with a potential refund.
5. Host a tax return completion party.
I promised you fun, and these tips will make your taxes more enjoyable than you might think. Still, unless you're someone who really enjoys reading IRS publications for each potential deduction--and no judgment if you are--the reality is this: The most fun you'll have in tax season is getting them done.
When you're finally done, celebrate with a party that requires attendees to have a completed return in hand before they can toss back a celebratory drink. If that's not motivating enough to help you finish your return. I don't know what is.
You can also throw yourself a party: Get them completed, give yourself a high five for being such a good adult, and treat yourself to dinner. Well, make it a business dinner. You'll thank yourself for that next year.