| How to Keep Records Like a San Jose CPA |
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| Written by Administrator |
| Friday, 18 March 2011 04:31 |
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Some people think CPAs are naturally the most organized people on earth: Taking reverent pleasure in the fine details of record-keeping, saving every receipt, and generally being the bookish sort. In fact, most CPAs aren’t that much more organized than you or I. They just follow a few, simple, best practice solutions for managing their records. Today we will show you some good habits of a CPA, San Jose. 1) DON’T BE AFRAID TO ASK FOR HELP Although it’s not necessary for the more seasoned of San Jose’s CPAs, there is nothing embarrassing about simply picking up the phone and dialing the IRS hot line for record keeping. Eventually you will get a friendly, informed agent on the phone who can help outline the Service’s policy on a number of issues. 2) WATCH THE ODOMETER Classifying business miles vs. regular miles can be difficult. But it won’t be if you keep a folder in your car with a pen and a detailed mileage sheet. 3) KNOW THE SMALL FROM THE LARGE You don’t have to hang on to the documentation of your purchase of a wrist watch for very long. Especially if you don’t intend to use it for the rest of your life. But more expensive items which are in use for longer, should be documented so long as they are being used. For example, your house (document until sold), your IRA (document indefinitely), and your air conditioner (document if planning to use for several years). Green energy mods to your home especially are worth saving for up to three years to get an energy credit from the IRS. 4) KNOW THE THREE YEAR RULE The three year rule states that a tax return can be audited or amended for a period of three years. That means you should hang on to every tax return for that time period. Especially if you err twenty-five percent on the estimation of your income, as then you can be audited six years later. 5) INVESTING If you play around with stocks or bonds, or any other investments-- Make sure you keep track of your losses and earnings. Each amount you exceed as a deductible capital loss from your investment, you can keep deducting over future years until the full amount is met. 6) CHARITY All tax deductible donations should be saved by your CPA, San Jose. If they’re not, keep track of the records yourself. Even donating clothes to Good Will, should result in getting a receipt you can keep. A charity dinner- that counts. Charity concerts, that too! Make a note on the description of the event so that you can recollect in case of an audit. Using these tips will put you into the mind of a CPA, San Jose. And it will save you a great deal of hassle come tax time! |
| Last Updated on Friday, 18 March 2011 04:34 |
