2019 – 11/14 Careful recordkeeping is one key to success for small business owners. A good system of maintaining records leads to better decision making. It helps business owners monitor business progress; prepare financial statements; identify income sources; track expenses; support items on tax returns; and more. Small business owners are free to use the system of their choice, but it should clearly show income and expenses. In only a few cases does the law require special kinds of records. Whether the choice is an electronic or paper system, it should generally summarize all business transactions in ledgers or journals. Here’s more from the IRS:

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