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Jan 7

FAQs: Bookkeeping and Tax Time

When people ask me what I studied in college I always tell them journalism (truth) because it was one of the few majors that didn’t require much math (partial truth). I always wanted to be a news anchor and for six years put on my best reporting face until one day I decided the wedding industry was instead where I belonged. I never doubted I could successfully run my own business. But I never actually prepared for what it would take to make the back end work. Meaning give me a bride who loves glitter and unicorns and I can dream up a stellar wedding aesthetic but ask me the difference between an expense and a cost and I might get a little weak in the knees (and not the same weak in the knees I get around peonies. Bummer.) It wasn’t until last year that I really realized I’d need to invest in my business in more ways than just photo shoots and instragram. So I hired a CPA. And left his office that day in big ugly toddler tears.

Turns out an IKEA storage box full of receipts with pretty short hand on the top of them, doesn’t do my CPA too much good. Neither does just thinking and not doing much about owning Quickbooks. But on the flip side there’s people called bookkeepers and my goodness am I ever glad I found an amazing one thanks to Ben and Laura. Hiring my amazing bookkeeper was by far my best decision in 2012 and something I would recommend to any business owner just getting started (or to any business owner who has been around for while but doesn’t yet have one.) If you’re unsure where to find a reliable one check with any industry colleagues or even friends and see who they can recommend for you to use.

A bookkeeper can really give you so much. For starters they can take that big scary box of receipts and make sense of them for you. I’m pretty good at keeping things and labelling them as I go but knowing what each receipt means and how it should be tracked is foreign to me. And totally boring. Enter a bookkeeper. They can also log all of your spending, earnings, draws, expenses and costs into Quickbooks so you can see in front of you how much your spending in each area of your business (for example I have ton of transactions filed under Business Development in 2012 and Florals for obvious reasons). Without getting into too much detail, the best part is come time to meet again with my CPA I can hand him a USB that my bookkeeper loaded my entire business onto, so he can do my taxes quickly and with ease.

Last Friday I met with my bookkeeper to give her some final December receipts and I have to say working with her has been such an eye opening experience. I’m not the greatest with money and wanted to make sure I became better in 2013 with it. Seeing my bank account listed out to the last penny in front of me (I’m very much a visual learner) and in front of a total stranger is a really good lesson on establishing wants and needs a bit better. Paired with the experience of adopting a family in need for the holidays I really am so thankful for everything this new step has taught me about money, value, organization and being accountable. Remember that whole living with purpose and intent? Amen to that.

To all of you other business owners out there, do you do your own bookkeeping and taxes?

ShayRhiChicago

Side note. I want to take a minute to address my Starbucks addiction. I drink way too much of it. And I know this is fairly obvious but I think I turned a blind eye to it late last year because I was that embarrased. Sort of like the girl who can’t quit buying Coach purses, or smokes, or baby clothes from the GAP or whatever your vice is. When I saw all of the charges from Starbucks listed out in my Draws Report for 2012 I took a really big pause and vowed then and there to cut back for the sake of my wallet and my sanity. And I’m happy to say I’ve done pretty good lately. So for old times sake, we’ll throw the above photo in here because it’s cuter than a photo of my IKEA storage box full of receipts; and I have what I like best in my hand, a lovely white and green Bucks cup. Happy Monday, friends. Love you Shay! xoxo

24 thoughts on “FAQs: Bookkeeping and Tax Time”

  1. Nora Rose says:

    As a CPA, I applaud you for owning what you know and what you’re good at. I cringe when I see blogs that say to “deduct this on your taxes” or “you can expense that” without any accounting background… I would love to work as a bookkeeper for the creative types, definitely something to keep on my future radar!

  2. ah, I feel like you wrote this for me b/c I’m you, pre-bookkeeper! I have a box of receipts and an email folder as well. My bookkeeping is an excel spreadsheet of payments received, and probably isn’t even up-to-date. This is the year I get my financial house in order. I wish I lived by you so I could hire your bookkeeper! Thanks for the inspiration.
    PS- I used to have a Starbucks addiction too, which I quit when I was pregnant (except for the occasional latte). Now I make my coffee at home every morning with a lot of splenda and a little french vanilla or pumpkin spice creamer. I now prefer my own at home. Buy yourself a super cute mug (I have one from Anthro) and it will make it more fun. Good luck!

  3. Kristin says:

    I’m rather partial to my bookkeeper too! Luckily, I’m married to him. That financial background and MBA comes in handy every once and a while. Haha! Happy 2013 lady!

  4. I had to laugh a little bit when I read the part about you picking journalism because it involved very little math as that was my same exact thought process when I picked my major and minor (also journalism). Hiring an accountant is on our To Do list this year as we have been putting it off and now I am almost embarrassed to let them see our finances!

  5. Maggie says:

    This is a great post. This time of year I think everyone cringes when their finances are broken down and you can see exactly where your $$ goes. Adding up all those starbucks trips.. it’s like thinking if I didn’t go I could have that chunk of money with me now. Regardless, if it’s not going to one vice it will go to another. My bookkeeper saves my sanity everyday and I think everyone should have one. Love the new 2013 goals! :)

  6. Lena says:

    Funny, I thought my music major would keep me away from math, too–I bet the instructor of my finance course is giggling like mad, and my high school math teachers!

  7. Kody says:

    Such a good post, I think this relates well to all industries. I am in the financial services industry (not accounting) and while I have all my receipts I haven’t the slightest idea what constitutes a straight line deduction or otherwise. We just hired our first CPA to handle all my lovely 1099′s. I’ll just leave the taxes to them!

  8. slamdunk says:

    Though I have a business degree, if I did start a business, I would follow your guidance and hire a bookkeeper. Outsourcing accounting and other support operations where possible allows you to focus your time on what you enjoy and excel at–and it allows you to sleep better at night.

    Good topic Rhi.

  9. Shana says:

    So I am sitting here drinking out of that famous green and white cup and learning from you all over again! Although I am far from beginning my own business { dreams! } I am so thankful for the reminder of keeping a close eye on spending and wants/needs etc.

    p.s If I havn’t told you yet, I love love the rebrand and I am so excited to hear more about your exciting year to come! I still think of you everytime I look at our wedding photo with the giant balloons { totally inspired by you! } If I ever renew my vows you are coming on a road trip to Windsor ok ;)

  10. Kudos to you for hiring a bookkeeper! I do my own bookkeeping which is actually pretty easy since most of my transactions (most) are via Pay Pal – so I always have a reference and a history that I can reference if need be. Plus I have a nifty (and lengthy) spreadsheet that I’m pretty good about keeping up with. Hubby does the taxes :) So it’s up to me to keep up with my numbers! I wasn’t so good about it in the beginning, but I’ve learned it’s so so important. Because come tax time if you don’t keep up with it – well, you end up feeling super overwhelmed! I’ve been there in the past – for sure :) PS. Good luck kicking the Starbucks habit! My caffeinated beverage of choice is Diet Coke – and it’s a really hard one to break!

  11. ashlyn says:

    ya me + money. ha i was that girl when i started grad school kept E V E R Y single receipt. welp lets just say that didn’t last very long at all! but i am still the worst with money & i am hoping that this year going into the big girl world will change that! & p.s. i am a starbees junkie. & have you tried their new VSL? if not you must! x

  12. katherine says:

    I do my own taxes. It is the pits but I do it giggle. xo P.S> I did business taxes for many years.

  13. Shalyn says:

    Gosh I adore you so much love bug. I can’t wait to see you again (SOON please!?) :) Can’t wait to catch up (again) tomorrow. XO!

  14. Kelly says:

    Ooooh ooh! I’m new to the owning-a-business side of things but all of my ridiculous past independent contracting jobs have left me in tears many a day. Fortunately my huz is a CPA but I still feel almost utterly hopeless in this regard. I commend your responsibility and hope that I can soon get my life and finances together and do this whole thing right!!!!

  15. Laicie says:

    Ugggghhhh — I could use all the help in the world with tax time. I think this may be the year I hire some help. :)

  16. Paula says:

    Great & timely post! I shared this with a few of my creative clients, as a gentle nudge.

    As I love to say to clients, if you have a shoebox, you’re waaay ahead of the pack! Believe it or not, a shoebox, envelope or *some* system is better than none at all.

    Good luck to everyone & thanks again for writing this article!

  17. Heidi says:

    I’ve had a CPA forever but was always spotty with bookkeeping. I used to use Quickbooks (with much pain and frustration) and then my friend Edyta (Syzslo) recommended Xero.com. I can’t sing it’s praises enough! If you are on QB now…seriously, transferring over will make you the happiest person.I now ENJOY doing my books. Seamless, easy FUN. yes, I said it. doing my books is fun. No, i’m not a rep for Xero…just a very happy customer. happy to share deets directly.

  18. brandi says:

    aww i love this! Cheers to 2013!
    and i love that you’re addicted to Starbucks. I think most of the world is…

    I posted about my wedding today and thought of you. :)
    xx
    b

  19. Amanda says:

    This is all admirable! Thanks for posting about the scariness of finances. Personal, business, it’s all the same…keeping the books balanced will keep the lights on!

  20. caitlan says:

    Such a helpful post, thanks for sharing your tips – especially in a language that I understand as a fellow creative/hopeless bookkeeper! x

  21. So happy to read this. This topic literally cripples my productivity sometimes. Thanks for being so candid and sharing – I feel better that it’s not just me! I’ve found a fabulous CPA who specializes in creative entrepreneurs that I plan to use as one of my business goals for this upcoming year. Cheers to 2013!

  22. Jennifer says:

    Thank you for your insights! I am contemplating starting my own business and just started my first blog. It all seems so overwhelming, but it’s great to see other young women taking on the challenge with ease. Cheers!

  23. I can’t stop laughing about the Ikea storage box full of receipts. Great read!

  24. Jenna says:

    Silly Question…. where are those sunglasses from! They are so fun!

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