So, let’s get to the juicy goosey part, which is preparing your business for tax season and organizing all your numbers.
When I first started my business I did not know anything about business and how to handle its finances. I had no idea that bank accounts, profit and loss statements, FICA, taxes and all that ‘mumbo jumbo’ is what makes your business legit. I had to learn that as I went, but these days I’m eating up business books like it’s a buffet. You have to know these things to produce a successful business — this means — making a profit, AKA cash-money-dough!
And you may be wondering, what are these “things” ?
Número Uno: You absolutely have to get a business bank account or a separate bank account for it. This will help you monitor the money going in and out of your business. Having record of expenses is extremely helpful when tax season rolls around. This helps a lot because now you don’t have to struggle explaining to your accountant that the $40 charge at Red Lobster was for a client, and not for a date with your girlfriend.
Number Two: You have be good at tracking, and we’re talking numbers here, not zombies like the bad-ace Daryl Dixon from The Walking Dead. Although, you might end up looking like a walker if you wait last minute to organize those numbers (like I did).
The first day I saw my accountant I was sporting a fresh black button-up with off-white corduroys. The next day, I rolled up my sleeves and half-assed an obnoxious green tie so he wouldn’t notice I was wearing the same clothes from the day before. I slept at my office that night because the method of tracking I did on my income and expenses wasn’t the right one, obviously. I had the correct numbers, correct sums and I had the categories, but not in the form the accountant needed them. So, if you don’t want to make this same mistake, make sure you have the following categories tracked and summed up:
Contract labor, utilities, rent, phone and internet, tax-deductible meals, etc. Everyone will have different categories, but make sure you track the ones you spent the most on each month. At the end of the each month you need to have a sum of each important category, so that at end of the year you can create a profit and loss statement.
Track those numbers!
Número Tres: Learn about business. You will not understand what you are doing if you do not educate yourself on business. Here is a list of websites you can go to, ask questions and educate yourself to be able to do the previous two tips. I go to, Inc.com for the latest on business systems and any questions I have on business basics. For accounting and taxes I go to irs.gov, yes –the most boring website on earth — but it has all the answers to anything related to taxes. Lastly, for more personal photographer-to-photographer information I visit Nashville’s finest, ZachandJody.com.
The reason I am paying $2071 more in taxes this year as compared to the $800 I had to pay last year, is because I have educated myself in business and therefore, made a bigger profit. I have taken learning about business very seriously and you should, too. You are not just a photographer, you are now businessmen and businesswomen.
If you are interested in sitting down with me to help you review your business and give you one-on-one advice on business growth. please fill out the contact form below.