After cleaning up books for dozens of NJ businesses, I’ve seen the same mistakes repeatedly.
1. Mixing Personal and Business Expenses
The most common and most damaging. Open dedicated business accounts. Period.
2. Not Reconciling Monthly
Errors accumulate silently without monthly reconciliation.
3. Categorizing Everything as Miscellaneous
If 30% of expenses are miscellaneous, you have no visibility.
4. Not Tracking Cash Transactions
Unreported cash income is an audit trigger. Unclaimed cash expenses are lost deductions.
5. Ignoring Accounts Receivable
Aging invoices represent revenue at risk.
6. Not Keeping Receipts
The IRS requires substantiation. Use a receipt scanning app.
7. DIY When You Shouldn’t
If books are consistently behind, it’s time to bring in help.
Disclaimer: The information provided is for general educational purposes only and does not constitute tax, legal, or investment advice. This content is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code. Tax outcomes depend on your specific facts and circumstances. Viewing this material does not create a CPA-client relationship. Personalized advice is provided only through a signed engagement letter.
Get Tax Tips from Greg
No spam, unsubscribe anytime.