Arizona accountant
5719 E. St. John Rd.
Scottsdale, AZ 85254
mailto:cpa@rontaxcpa.com
(602) 867-4199
Fax: (602) 788-6911

January, 2003 Tax Tip

Now isthe Time for 2003 Personal and Business Budget and Tax Record Organization

Budgeting

Although the need for a personal and business budget may seem obvious, many individuals and companies overlook this critical planning tool. Therefore, a brief reminder may be in order at we embark upon a new year.

A budget is extremely effective in making sure you have adequate cash flow ó and, thus, in ensure financial success. Thatís why every person and business (from the smallest to the largest) should have a budget.

At this time, individuals and business owners should get together with their accountants and budget (project) income and expenses for the coming year. Amounts can be broken down to cover monthly or even weekly periods, depending on one's needs.

Once the budget has been made up, then monthly actual income amounts can be compared to monthly budgeted amounts. If actual income falls short of budgeted inome, expenses must generally be cut.

Organization

To avoid the agony of going back through your check register and credit card statements at or after year end, I suggest that you take a number of large envelopes and mark each one with a business or personal expense category that may have tax implications.As you receive and pay bills or invoices mark the amount, date paid, and check number on each one and place it into the appropriate envelope.Examples of business categories are car, telephone, insurance, and office supplies and expense.Examples of personal expenses with likely tax implications are charities, property taxes, and medical.

I find that doing this at least monthly will save you countless frustrating hours at year end and at tax return preparation time.At the end of the year run a tape of the items in each envelope and staple the tape to the outside of the envelope.This will also save you money on your tax preparation fee.

If you need assistance in budgeting and/or organizing records, I'd be most happy to assist you

Here's wishing you a joyous, prosperous, and healthy New Year!!



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