Having become an entrepreneur and joined the ranks of the self-employed, there are some things you should know to make the most of your new opportunity. Even if you have previously owned or currently own another business in addition to being an IBO, please realize that there may be some things relative to this Business that are different from others. This guide might seem oversimplified to some of you, but it is designed to be a teaching tool for even the most basic level of understanding.
Either way, as a first time business owner or a seasoned veteran, I hope the thought of building this Business is exciting for you. As you progress on the road to success, you will have access to many tools to help you build your business. The subject of the following discussion begins with the use of two of the simplest tools: a pencil and a daily planner in electronic or paper form. From there, believe it or not, you’ll learn simple ways to manage your own personalized business plan, budget, and break even projections.
I cannot teach you to be an accountant. However, I will teach you the types of records you need to keep for your business, and how to keep them. I will also give you some suggestions and tips to assist you should the I.R.S. request to examine your records. If the I.R.S. does contact you, and you’ve failed to keep good records, you might unnecessarily spend hundreds or even thousands of dollars that could have been used to build your business.
Keeping good records is not just important at tax time, but it also provides you important insight to help monitor your business throughout the year and meet your objectives. This is especially true as your business grows and your organization of downline IBOs gets larger. Keeping complete and accurate records, although not the most exciting part of building your business, is very important.
Now that you’ve been introduced to the importance of good bookkeeping and the tools that will help you get the job done, I’ll give you some pointers to insure that your records are in good order, allowing you to substantiate all items reported on your income tax return.
And, lastly, please be sure to consult your own professional advisors, such as an accountant or an attorney, for advice and information about income tax laws and requirements for record keeping and the proper preparation of your income tax return.