January has arrived – Time to Start Thinking About Tax Time!
The tax deadline is still months away, but there is no better time than now to think about getting your tax records organized. The right records management plan can play a significant role in getting you ready for that important date, saving you time, and potentially some trouble. Do you have a records management plan in place that spells out what to keep and also makes it easier to access your records when you need them? Here are a few guidelines to help:
- Organization can build a solid foundation. Figuring out your record keeping needs will dictate what your next step is. Are your records currently securely stored and are they accessible when you need them? If not, consulting a records management company for advice may be where you start. A lack of organization, or worse, a lack of security of data, can doom any business.
- Financial statements and tax statements. At the minimum, keeping records from previous years, typically six years for tax-related documents, will give you a good head start on this year’s tax filing. This should include any supporting documents like receipts and sales records.
- Security is paramount. While easy access to documents can save you or your employees time and money, protecting the confidentially and security of your records not only reduces the chances for data loss or theft, but also limits your exposure to potentially damaging consequences. Failure to protect sensitive client information can expose a business to expensive and damaging litigation, potentially destroying the hard earned credibility of your business.
Taking the time to review your records management plan now can give you a head start at tax time, the most critical time of year for most businesses. When it comes to documents and record keeping, matching the right plan to your business needs could be the most important business decision you make this year.