Industry • Best Practice
Why Reporting Software Is Your Secret Weapon Come Tax Season
Dec.16,2022By Boulevard Staff
A digital helper organizing your finances will cut down the time you spend filing
They say only two things in life are certain, and if the age-old adage is right, taxes are one of them. While the tax collectors may only descend from their towers once a year, keeping track of your income and expenses through each season will help with the obligatory tax-filing headache (though a bottle of wine doesn’t hurt, either). But the best way to kick that number-crunching migraine from your head is to use reporting software year ‘round to track your beauty biz’s finances.
Why your tax reporting software needs an upgrade
You probably got into beauty to help people look and feel their best, not agonize over expense reports, but the business-y side of the business needs love from time to time too. Keeping your financial documents prim and proper throughout the year will reduce the time you spend wading through paperwork when tax season comes around, so you can get back to trimming bangs and lasering things. But when was the last time you thought about how you were storing and tracking financial documents? If you’ve gone a few years without evaluating your tax reporting software, you may need to re-evaluate if your accounting is accountable.
Tax season is tough on everyone, but for small businesses and independent contractors, there’s seemingly no end to the receipts, exemptions, exceptions, and regulations that complicate the process. You need a lotof information to avoid a visit from your friendly neighborhood tax auditor, and that information needs to be organized enough to understand. Every arrow in your quiver counts, but the reporting software you use can make an especially huge difference both in how financial information is organized, and what your final tax bill comes down to.
The biggest benefit of good tax software is a balanced budget. You don’t want your income and expenses to fluctuate unpredictably throughout the year. Tax reporting software can help, showing you data trends. So, when do you know you need to change? If your reporting software has you separating 1040-ESs from 1099-Cs manually, it’s time to look for a new solution.
How to keep your finances fit for tax season
No one wants to sort through a box of financial records when they sit down to tally taxes. Instead, it’s better to log everything bit by bit digitally throughout the year. It’s less stressful to use a search bar to find the info you need to file than it is to scavenge for a single coffee-stained sheet of paper (trust us, we know). Here are a few ways to use reporting software to shorten your filing time.
Keep it copacetic
Preparation is half the battle. A disorganized jumble of paper receipts isn’t going to do you any favors during tax season, especially with the volume of receipts a beauty business needs to track. Let’s take a quick count of just a few of the items a beauty biz can write off on their taxes:
Kits and tools
Cell phones (for business use)
And those are just the essentials. To pay as low of a bill as possible, you need to keep track of each one of those expenses and have the receipts to back that you’ve paid for them. That means every line item and every penny needs to be accounted for. Depending on the size of your beauty biz, that’s likely hundreds or thousands of receipts that need to be filed and organized into an expense report. Reporting software can help you manage records through searchable tags, drastically reducing the headache of sorting through everything.
Find (or make) templates that work for you
Reporting software is built to be user-friendly, but the templates they use for tracking business data, like sales, aren’t always easy to parse. Custom reporting templates can make record keeping (and taxes) more approachable. For example, you might need to tweak a few fields if your business has independent contractors rather than salaried employees. With customizable templates, you can prioritize the most pertinent information for your situation, which will come in handy when matching digits to boxes during tax season.
Dig into data
Reporting tools can help you understand the how and why of your beauty biz’s financial performance, as well as how much money to set aside for tax season. Reporting software that can highlight granular data is the best way to know where your business is trending, what its problem areas are, and where you excel. By understanding the nitty-gritty of the numbers, you can make more accurate quarterly tax payments and avoid unpleasant surprises when you file your yearly taxes.
Let Boulevard help you organize
The bottom line is this: Reporting software should help you lower your tax bill while also giving you the tools you need to help grow your business. At Boulevard, we’ve worked diligently to create reporting software that goes the extra mile so you can grow your spa or salon. Our platform helps you form a deeper understanding of how your business is doing and what that means for your tax bill, with customizable forms and an intuitive tagging system to keep you organized. Get a demo today to see how it works.
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