Accurate, updated bookkeeping is an essential part of any small business, providing insight into the company’s financial health and preventing future problems with the IRS. Unfortunately, for many small business owners, who lack accounting and bookkeeping skills, mistakes with long-term consequences may not be easily detected. Below are a few of the most common mistakes small business owners make and how to avoid them.

3 Common Bookkeeping Errors

1. Putting It Off

Few entrepreneurs go into business to do accounting, so it’s easy to put off bookkeeping when other tasks seem more pressing. However, accounting chores only become more daunting the farther behind you get. If you wait too long to tackle the book, you’ll eventually find yourself overwhelmed. Outdated books may cause you to miss a tax deadline, misreport sales, or misallocate funds.

2. Mixing Business & Personal Accounts

Many small business owners mistakenly assume there’s no harm in mixing personal and business accounts. Business and personal finances are subject to different accounting rules, and combining the two can cause you to miss valuable deductions or trigger expensive IRS penalties.

3. Failing to Keep Receipts

IRS audits can be extremely stressful, especially if you don’t have receipts to back up your claims. Fortunately, bookkeeping software and smartphone apps make it easy to store digital copies of receipts, allowing you to keep them indefinitely.

Bookkeeping is a complex, time-consuming project, which is why business owners throughout St. Peters, MO, rely on William G. Molitor, CPA, skilled financial professionals with 40 years of experience. With their array of customizable services and exacting attention to detail, you can depend on this firm to handle your finances so you can concentrate on building your business. Visit their website for a closer look at their financial services, or call (636) 926-0502 to make an appointment today.