Archives For Taxes


Check out my previous posts on going paperless (Part 1 and Part 2)

Once you have a framework for your workflow, you’ll need to start scanning stuff. Some items you’ll want to scan and then throw away the original. Other items you’ll want to keep the original, but it still useful to have the scanned copy as well. Other things you should just avoid scanning if you can. Here’s a short breakdown of the major items for each category. When reading these lists, think in terms of general ideas. Your business and personal life may include other items that aren’t listed here, but clearly fall into one category or another. You’ll see the similarities.

EverNote Icon

Business Items to Scan:

(Keep these items at least 3 years. Purge after 7 years)

  • Orders from your shows (purge these after the show is finalized if there is any payment information on them)
  • Monthly Expense Sheets
  • Individual Business Receipts
  • Monthly Data Graphs
  • Tax Papers
  • Business Documentation (corporate meeting minutes, articles of incorporation, etc.)
  • One copy of your business catalog
  • Digital copies of your business flyers, specials, end-of-life list, customization guides, etc.
  • Utility bills
  • Any receipt or bill that you think you’ll be able to deduct from your taxes.

Personal Items to Scan:

  • Birth Certificates
  • Social Security Cards
  • Driver’s License
  • Insurance cards (auto, home, medical, dental)
  • Insurance Policies
  • Magazine articles you’d like to read later.

Yes, you should use your scanner to save personal items like marriage certificates and birth certificates. Keep copies of those items in an “Important Documents” folder in Evernote. Note that you should take care to protect your computer, hard drives, and any portable device which you give access to these documents. Identity thieves would love this stuff. 

After you’ve been doing it a while, you may find it beneficial to scan in recipes, instruction manuals (often you can find these online in PDF format and just save them in Evernote), old pictures, magazine articles you want to read later, magazine inspirational items (places you’d like to visit, houses or rooms you like in Southern Living, etc.), pictures of personal artwork, idea books, etc.

Items you should always keep in paper (at least the original):

Consider getting a fire-proof safe for these items (at least ones you don’t always keep on your person). You can usually get copies from official sources, but it can be expensive. Plus, if you have a special place for them, you’ll always know exactly where to look when you need them. Having the digital copies will suffice for most needs you’ll have. 

  • Birth & Marriage Certificates
  • Business Licenses
  • Driver’s License
  • Tax Returns
  • Mortgage and/or Title papers
  • Other Loan documents
  • Lease paperwork
  • Divorce Papers and Parenting Plans
  • Documentation of bank or credit card account closures (especially if there was legal involvement)
  • Essentially any legal documents (if you were involved in a legal case) 

Do Not Keep Copies of These Things:

  • Credit card information from anyone.
  • Actual checks from customers
  • Basically anything that could get you in trouble (generally this is going to be some other person’s personal or financial information. Even if you need it for a short period of time, purge this after month-end)

Don’t Waste Your Time Scanning:

  • Non-deductible receipts or bills.
  • Junk mail
  • Business items older than 7 years old
  • Books/Magazines – there are people that scan in whole books and magazines for later use. This involves destroying the original to get it through the scanner. While there may be specific instances this may be necessary, you’re probably better off buying a digital version in the first place (and there is merit to going paperless in that way too).


What is your greatest fear about going paperless?
Do you have a success story you can share?

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Financial Peace RevisitedFinancial Peace Revisited by Dave Ramsey

My rating: 5 of 5 stars

This is an absolutely fabulous book for anyone who wants to transform their financial situation from a nightmare into an absolute dream! My wife and I are currently going through Financial Peace University and this book is almost exactly the same information. It is indispensible.

Financial Peace Revisited is essentially the book form of Financial Peace University and is actually a part of that curriculum as you are asked to read certain chapters in association with a given week’s topic.

The book has chapters and subsections. Chapters cover really everything you need to know about money, starting with the basics, then expanding into topics that will help you understand the spiritual aspects of money (yes there are some) the emotional aspects of handling money, lifestyles (and lifestyle management). And of course they cover budgets and the famous Debt Snowball.

Basically everything is geared toward educating you not only to understand money but also to understand why you are tempted to do the things that end up causing people to end up in money trouble. More likely than not, if you’re reading this book you have experienced some financial trouble, or are pretty deeply in trouble. It’s not enough to blindly follow somebody’s advice on how to get out of it. If you do that, you’ll simply end up in the same trouble again in the future. On the other hand, if you learn the pitfall(s) that lead to your trouble in the first place you are really learning how to avoid falling into the same trap(s) in the future.

This book isn’t just for people who know nothing about money. Later chapters discuss building strong emergency funds (and why you should), retirement funds (and educates you on the most common solid options there), insurance coverage, and even charitable giving. There are chapters on teaching your children about money and also on how to handle money issues with family and friends (which can be touchy and very dangerous if you don’t think about it logically.

Overall, this is an absolutely fantastic book. I can’t say enough about it. Almost everyone out there could likely learn some things in this book that can substantially change their financial future, or at least has the potential to do so. Those lease likely to benefit are people who are deeply involved with wealth management already (perhaps professionally). And we all know people who constantly tell people the right thing to do, yet fail to follow their own advice.

You can of course buy Financial Peace Revisited
at Amazon (I get a small referral fee if you use this link).

Also, check out all of the resources available to you on Dave Ramsey’s website and his My Total Money Makeover Site.

View all my reviews

The most valuable piece of tax advice I can give you (the direct sales businessperson) is to make an appointment with a good, aggressive accountant to discuss tax strategy for your business.

Tax Quote

Business Tax Basics

JasonC —  October 2, 2012 — 5 Comments


Many people working with Direct Sales (both men and women) are probably venturing into the realm of a personal business for the first time. That’s something to be app loaded because there’s absolutely nothing in the world like being your own boss. Even if you (or she) have worked in someone else’s business, it’s just a totally different world running your own, especially when it comes to taxes and organization.

But being your own boss comes with a downside – huge amounts of responsibility. No matter what your previous experience or education, you will be expected to run your business professionally. If you don’t, and you get audited, there’s a good chance you’ll be in trouble. I’m going to try to lay down some basics here. By no means is this comprehensive, so take some time to educate yourself as well. This is a good place for a Direct Sales Husband to step in and help, check the books, and make sure nothing gets missed.

For every direct sales consultant, regardless of her level, here’s where you should start:

1. Keep your business activities as separate from your personal activities as possible. Get a separate business bank account (and pay all your business expenses out of it). Get yourself a business phone line. 

2. Create an office in your home. Even if it’s just a corner of a room, keep all of your business stuff there. Preferably have your own room for this (and know the square footage)

3. For each party, keep a record of mileage, the hostess gift(s), door prizes, food you’ve purchased. Returns of product. Make sure you include delivery mileage.

Check out the Party Tracker. (I created it for Holley’s Thirty-One business, but it may be generalizable. Feel free to modify it or make it your own. Don’t wait until later to track this stuff. Do it as soon as you can with each party.) Also make sure you track any money received vs money owed for product. This is critical!

4. If your company requires you to keep inventory, make sure you follow this closely. Keep paper records. Even if you keep electronic records, keep a paper copy in case you have hard-drive failure.

5. For each month, reconcile ALL of your income and expenses.

I have an Expense Tracker for this too. (Again, it’s for Thirty-One, but you get the idea.) I think it’s a good idea to use a folder system so each month has its own folder. You put all your Party Tracker sheets in it, along with any receipts for expenses in the month and the Expense Tracker.

6. Keep all your receipts that MAY be considered a business expense. Keep it in the monthly folder. Keep your folders together.

7. At the end of the year, you’ll have everything in one place. The 31 fold-n-file is a great item for keeping these things.

Common Direct Sales Expenses to Track Monthly:

  • Cell Phone
  • Internet Connection/Usage
  • Office Supplies (paper, envelopes, printer ink, postage, pens, small office items)
  • Specific Business Supplies (forms from your company, catalogs, display items)
  • Product (both for display purposes and inventory if you have to carry inventory)
  • Customer Incentives (items you give away, etc.)
  • Travel Expenses (if you do a distant show/expo/etc, or even just for traveling to your shows.)
  • Training & Education (there are personal coaches, all sorts of CD’s & DVD resources available)
  • Team Incentives (if your wife has a team, this can be pretty significant, but make sure she keeps it reasonable! I’ve heard stories of some not-so-reasonable team gifts/incentives. Don’t let her fall into that trap!)
  • Office Equipment & Depreciable Items (if you get a new computer for her business use, printer, scanner, fax machine, shredder, iPhone, etc.)
  • Advertisement (post-cards, mini-catalogs, business cards, print ads, online ads, etc.)

For higher level leaders with sizable teams track everything above plus:

1. Expenses for team meetings.

2. Travel and expenses associated with national conference.

3. You’ll probably have more education/coaching costs. Remember books you buy to help you learn the business or just to learn business in general count.

4. You’ll have more team incentives to track.

5. If you attend any leadership retreats with the company or if you hold your own team retreats.

6. Consider a business assistant to do tasks you dread doing or that you find trip you up entirely too often.

7. Talk to other successful direct sales people and ask them who they use as their accountant. Make an appointment to talk strategy. At least yearly. This is NOT during tax season. It’s best to do after tax season (after the accountant takes their annual vacation after the tax crunch).

8. Consider incorporating. Discuss this with your accountant and a lawyer. If you’re making 6 figures, this is probably the right thing to do.

The most valuable piece of tax advice I can give you is to make an appointment with a good, aggressive accountant to discuss tax strategy for your business.

This is NOT to discuss this year’s taxes. It’s to discuss NEXT year’s taxes and what you should be looking for, tracking, deducting, etc. Talk to all of the most successful business people you know personally and use the most highly recommended accountant. You don’t want one who is a push-over. You want someone aggressive. It may cost a couple hundred dollars (or less, depending), but it’ll be an hour of your time and money very well spent for the future.


Girls: What other expenses do you have that I didn’t mention above?
Guys: What is your experience with running your own business? Did I miss anything in your opinion? 

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