As a roofing contractor, running your business takes more than just doing good roofing work. You also have to effectively manage the business side of things. That includes knowing the bookkeeping requirements you need to follow.
Save All of Your Receipts
Tax laws require you to save all of the receipts for the business expenses you claim. This includes roofing materials, tools, hiring contractors, and other expenses.
When you write off your business expenses, the IRS has the right to audit you. This means that you have to be able to prove that you had those expenses and that they were for your business. If you don't save your receipts and don't have proof of your expenses, you could lose those deductions and get in trouble for not paying enough in taxes.
Have a Separate Business Bank Account
Depending on where you live and what type of business you have, you might have a legal requirement to have a separate bank account. Even if it isn't the law, it's still a good idea to have one.
The first thing a business bank account does is show that you're actually operating as a separate business. This is extra important if you have a corporation since being a corporation does require you to strictly separate your personal and corporation money.
The other thing a business bank account does is to help organize your income and expenses. What's in your business bank accounts is tied to your business. What's in your personal accounts is tied to your personal spending.
Create Profit and Loss Statements
You need profit and loss statements to help prove your business income and expenses as well as to qualify for loans. Profit and loss statements are a summary of your income and expenses for a month, year, or quarter.
If you don't have a bookkeeper creating profit and loss statements for you, the best thing that will happen is that your tax accountant will charge you a lot more at tax season to try to go back and make them. In some cases, not keeping records at the time you have income and expenses can make it hard to prove your income and expenses to the IRS or lenders.
Profit and loss statements also help you to manage your business since it's important to understand your margins and make sure you're charging enough for your services.
To learn more about bookkeeping for roofing contractors, contact a local bookkeeper today.Share