Wednesday, January 30, 2008

I can now breathe...

WHAT is in the green box? EVERY SINGLE infinitesimal receipt from the year 2007, that's what!!

I just completed adding up all of my receipts AND income from the year 2007. Whew!! Glad that's finally over.

I tell you, tax time gives me the heebie-jeebies. I can't help feeling that looming sense of dread when the time rolls around that I have to dig through every infinitesimal shred in my records and look at it under a microscope. I had a pretty easy time counting tonight on the calculator, which is a blessing. (My fingers were up for the challenge, I guess.) It wasn't one of those experiences where you add up 25 numbers, dare yourself not to make any numerical notations as a fail-safe, then dramatically forget which number you were on, and have to re-add the entire column all over again, from the beginning!! Ooh, nightnmare. No sirree, not tonight!! It went smoothly! YESSSSSSSSSSSS..........I can breathe now.

A few years ago (when I started freelancing for real) I decided that I was going to do everything RIGHT where taxes/accountability was concerned, no matter how initially painful it would be. And yes, it would be painful... I was never trained on financial responsibility and accountability when I was a youngster, and, to top it off, I was never a great math student in school... So, as you can imagine, the entire process has been a lot of work and very challenging at times, and a lot of holding my feet to the fire. But today I can hold my head high and say that I am SO proud of myself! I've come such a long way. It is not ever really completely painless, but I CAN say that "doing things right" gives me a amazing feeling of peace, relief, positivity and true confidence that I can't put a price on.

There is things one can do to make tax time less painful. Keeping a separate credit card and bank account help keep things organized in a tangible sense, as well as just mentally. Knowing that things are separated in this way can relieve daily stress and anxiety. Many freelancers who are in that 'limbo' area between working their day-to-day full-time job and freelancing the rest of the time may surmise that these additional steps are just added work and unnecessary. But to the contrary, I personally feel that it's incredibly important in many ways. It not only helps with just general organization of your business finances, it also trains you to have good financial practices, which will only help you in ALL aspects of your finances. It's also an unspoken promise to yourself that your goal is to TRULY THRIVE as a professional artist, and that your business is NOT an afterthought.... And all of those things are VERY, VERY important!! :)

My first step was making an appointment with an accountant. He gave me a crash course in small business tax 101 and he tailored it to my own business and needs. Taking this step is worth the expense. You gotta learn this stuff somewhere, and it might as well be from a professional in the field!! (If you're worried about the cost, don't. You and your business are WORTH it. You can expense it. Case closed.) The sense of empowerment you receive when you are learning the right way to do things is really beneficial in so many ways. The positive enforcement has ripple effects throughout other areas of your life!!! :)

6 comments:

Chickengirl said...

Lucky! My receipt pile is still sitting in the corner right now. I haven't touched it yet. Its haunting me....

I really should at least open a separate account for my business. All these "shoulds" but I think year by year I get a bit more organized, so thats a good thing.

You are pretty good- getting all your stuff together and its still January. Wow!

imwithsully said...

Yes, yes. Organization is sometimes hard when you are so busy though. That's why I have awarded you the "You make my day" award! Come vist and pick it up! :)

carol eldridge said...

I should have known you were a Mass Art grad...so you see we have a connection....anyhow, it was fun getting the award and then passing it on to others...

have a nice day! I knew Dan....

best,
carol

Eric Orchard said...

" your business is NOT an afterthought" Here! Here! I'm realizing this more and more and I'm happy you share these thoughts as well. It can be hard to convince some people, I get comments from friends that seem to assume I don't want to make money and just want to be a bohemian artist. My father in law is an accountant and he's been a tremendous help. I still hate doing taxes. Yuk!

Sparky Firepants said...

We have to pay taxes?

oops.

Actually, in this, my first year solo, I'm just getting a handle on all of this. Thanks for the advice of seeing a pro. I was on the fence until I read this and now I'm decided.

Anne Leuck Feldhaus said...

Good for you Kathy! I have yet to do mine and my appt w/my accountant is only 2 short weeks away. I keep all my receipts in quicken and make myself enter them every month..it does help a lot at tax time, but I still suffer the same heebie jeeebies!