How to Keep Track of Your Home Business Finances

If you're starting a home-based business, you'll have to keep careful track of your money for tax purposes. While this may sound like an extremely daunting task, with a little organization you'll be free from worry once tax time rolls around.

Difficulty: Moderately Easy

Instructions

1. Keep track of everything you're spending on your home business, including office supplies, materials and gas if you're driving for work. These can be kept in an Excel document and should be divided by month.

2. Create a desktop folder for each client and within that folder keep all information you have on that client, including invoices.

3. Keep track of who you're doing work for, how much they're paying you, when you've been paid, and any notes you may need to include (such as late fees) in a separate spread sheet.

4. Invest in an accounting program such as QuickBooks, which will help you to stay organized and keep all of your transactions in one place. Spreadsheets created in QuickBooks will help your accountant to figure out your finances during tax time.