Maintaining good records is important to help meet your tax and legal obligations. With the tax deadline looming in the near future, you probably have already gathered all of your important paperwork to be ready to file your taxes. The right record keeping system not only helps you to satisfy these obligations, but they may even save you money and time. Read more below for the 3 basic ways you should consider using for your record-keeping system.
With Tax Season around the corner and all your financial statements at your fingertips, it's a great time to take a look at your best next steps.
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What Records Do You Need to Keep?
The first step is identifying the records you need to maintain. The obvious examples include leases, contracts, payroll and personnel records and a range of accounting and finance information, such as invoices, receipts, checks, payables, and inventory. Please consult a professional with tax expertise regarding your individual situation.1
How Do You Want to Keep Them?
Record maintenance can take three basic forms:
- Paper-based—It’s old school, but maintaining records in file folders stored in a metal cabinet may be sufficient, though at the risk of files being damaged or destroyed with no back-up.
- Computer-based—Maintaining records on computers save space and make records management easier. Consider backing up files and keeping them off-site.
- Cloud computing—Records are stored and managed on the internet, offering possible savings on software, reducing the risk of lost data and providing access from any location.
What Software Should You Use?
The right software can make life more productive; the wrong software or tools may cost you time and money.
When shopping for software, consider:
- Is specialized software available? The needs of different people and professions can vary greatly. Specialized software may have capabilities not available with more generic software.
- The size of your organization (if you have a company) Do you want an easy-to-use package, or are you able to hire a dedicated employee to take advantage of a more sophisticated alternative?
- What sort of training and support is provided? Without the right measure of either, your software may not be productivity tool you envisioned.
- What are its mobile capabilities? If you operate your business from the road, you may want your software to have robust mobile features.
1. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG, LLC, is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2022 FMG Suite.