Setting up a Filing System
Keep those Receipts
Keeping receipts is extremely important. If you ever get audited, having receipts substantiates your business expenses.
Quick and Easy Filing System
The first thing you need is a file box or filing cabinet that will hold hanging folders.
Then you need hanging folders (green) and file folders (light yellow).
I recommend labeling each hanging folder with the expense category. Then in each hanging folder, label a file folder for that year.
(Note: I use Post-itsr to label my folders, hence the yellow rectangles in the above photos.)
Then after two years, you can archive your files. For example, in 2009, I keep 2009 and 2008 file folders in the office. I put 2007 and earlier in a bankers box.
Accounts
This is how I set up my hanging folders. You'll probably have a different list of expenses. Whatever makes sense for your business is okay.
- Advertising
- Cost of Goods Sold
- Computer
- Education (employee education)
- Employee Benefits
- Gifts
- Income (keep 1099 forms W2 forms here and other income related paperwork)
- Internet Services
- Legal & Professional
- Meals
- Mileage Logs (cars)
- Misc.
- Mortgage (mortgage info for business use of home deduction)
- Office Supplies
- Payroll
- Phone/Fax/Cell
- Photography
- Postage/Shipping
- Printing
- Publications
- Subscriptions & Dues
- Reimbursement (for when you reimburse yourself for business expenses paid by cash or personal funds)
- Forms/Reports (file misc. tax forms and paperwork here)
- Samples
- Services
- Tax Returns (file old returns here)
- Taxes Paid (file taxes paid to state, for example)
- Tools
- Trade Shows
- Travel & Entertainment (not meals)
- Un-filed Receipts
Action Items
- Visit your local office supply company and buy a file box, hanging folders, and file folders.
- Set up your filing system.
Questions
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