Small Business Bookkeeping Is Your Legal Responsibility!

Small Business Bookkeeping is just about one of the most important responsibilities a small business owner will have. If you are making money from self-employment full or part-time you are considered a small business owner and the success of your business depends on creating and maintaining an effective record-keeping system. It does not matter if your business is a sole proprietorship, partnership, or corporation.

For tax purposes, you are required to keep good accounting records. Most importantly, the record-keeping system you use must be suited to your particular business needs. Bookkeeping is the first part of the accounting process, so the work of a bookkeeper and accountant often overlaps.

Difference between an Accountant and a Bookkeeper

The difference between an Accountant and a Bookkeeper is an accountant is a professional who handles the bookkeeping and prepares financial documents like profit-and-loss statements, balance sheets, etc. They perform audits of your books, prepare reports for tax purposes, and handle all the financial information that’s part of running your business. Bookkeeping focuses on recording and organizing financial data, while accounting is the interpretation and presentation of that data.

Benefits Of Keeping Good Records

The number one reason for keeping good records is to be in compliance with the law! Record keeping is also about understanding your business, now and in the future. Reasons, why you should keep good records, include:

1. Detail Tracking

Owning a small business will require you to track a significant amount of information, such as customers, sales, inventory, and expenses. Without a proper record-keeping system, tracking important details of your business may be impossible and can lead to you paying far more taxes than you should have.

2. Legal Compliance

As an owner, you may hold various licenses, permits, insurance, contracts, etc.. As an employer, you will be required to maintain and report employee payroll for tax purposes.

3. Tax Preparation (Federal, State, and Local)

You need good records to prepare your tax returns. Good records of your business financial transactions may be able to save you thousands of dollars. Your records must support the income, expenses, and credits you report. You need Supporting documents including sales slips, paid bills, invoices, receipts, deposit slips, and canceled checks. Purchases, sales, payroll, and other transactions you have in your business will generate supporting documents.

Generally, these are the same records you use to monitor your business and prepare your financial statements. The financial statement may include income (profit and loss) statements and balance sheets.

  • An income statement shows the income and expenses of the business for a given period of time.

  • A balance sheet shows the assets, liabilities, and equity in the business on a given date.

Common Bookkeeping Methods

Manual Bookkeeping

With manual bookkeeping business accounting records are entered into a notebook or journal. You should have a basic understanding of the types of small business accounts there are and debits and credits. You will also have to decide what accounting method you will use to enter your transactions.

Accounting Software

By far computer accounting software is a great option for handling your bookkeeping needs. I could not live without it! You don’t have to worry about having extensive knowledge of accounting. Computers transfer the right numbers to the right accounts and make sure those numbers get put on the proper side of the account, the debit side, or the credit side.  

If you are starting your first business, you will quickly find out how important accounting software is to the success of the business. Accounting software keeps track of business financial records such as sales, expenses, inventory, and assets. The software delivers many advantages over manual systems, helping you to execute, manage, and track your critical financial transactions and related financial activities.

Small business accounting software will help to systematically organize your financial information, in a way that is easy to access. For example, if you want to know if a certain bill was paid, an accounting system should be able to tell you not only when the bill was paid, but the check number, and other details, such as details you may have recorded about the vendor. If you lose an invoice or a bill, information for sending duplicate invoices or bills can be found in the program.

You can also save money on tax preparation every year because your information will be well organized, not in manually-entered notebooks or in shoe boxes. You will also be able to generate specific income and expense reports as needed.


Spreadsheet software is commonly used in business to track information about clients, inventory, sales, employee timesheets, and much more.

Record Retention

Not only should small business owners keep good records, but owners should also know which of those records to retain and for how long. Record retention is the practice of keeping business and personal records over time.

The Internal Revenue Service (IRS) determines some record retention guidelines. Other retention requirements are legal in nature, such as what may be required by contract with those you do business with. Expert recommendations vary. Also, retention schedules vary by region. For example, a state may have a different statute of limitation for legal liability (lawsuits). Check with your attorney for legal requirements. Check with your accountant for financial-related requirements.

Three Key Points to Remember

1. As a small business owner you will need to track a significant amount of information. No matter the type, size, or complexity of your business, establish and maintain a proper record-keeping system that is suited to your particular business needs.

2. Regardless of whether you use a computer system, cloud-based computing, or a combination of these two, you will need to think about business accounting software.

3. Pick one record-keeping system or use a combination—but start now.

What Is The Gig Economy?

The gig economy is based on flexible, temporary, or freelance jobs, often involving connecting with clients or customers through an online platform. The “gig economy” is a relatively new term for a traditional way of earning a living: being paid on a per-job basis for work performed directly for a customer.

Being hired to do a single short-term task, project, or job can be called a “gig.” This type of occasional work is part of what is now referred to as the “gig economy.”

A Brief list of Examples of work in the  gig economy is:

  • Drive a car for booked rides or deliveries 
  • Rent out property or part of it
  • Run errands or complete tasks 
  • Sell goods online including in Online Marketplaces
  • Provide creative or professional services
  • Provide other temporary, on-demand work
  • Freelance work

People working in the gig economy use Digital business platforms that match workers’ services or goods with customers via apps or websites. This includes businesses that provide access to:

  • Ridesharing services
  • Delivery services
  • Crafts and handmade item marketplaces
  • On-demand labor and repair services
  • Property and space rentals

Examples of Gig platforms connecting service providers with customers, or gig workers, are too numerous to list here, a couple of popular gig platforms are Etsy and Uber. Gig economy workers are generally classified as independent contractors.

In a gig economy, large numbers of people work in part-time or temporary positions or as independent contractors even in the corporate sector. Gig work can be a great way to supplement income, try out a business idea, or become self-employed. Gig work is also referred to as a side hustle.

According to a new law beginning with the tax year 2022 if someone receives payment for goods and services through a digital platform, third-party payment network such as eBay, Etsy, Uber, and others their income will be reported on Form 1099-K if $600 or more was processed. Keeping good records of money coming in and going out of your business will assure you are in compliance with your tax obligation!

The downside is gig work doesn’t offer traditional benefits like insurance or retirement plans. On the upside, some people are making six figures in online gig work. With that kind of money, you can invest in your own retirement plan and insurance!

Free Summer Bowling Pass for Kids

Kids Receive 2 FREE GAMES Of Bowling Each Day Of The Kids Bowl Free Program All Summer Long! More than 800 bowling centers participate in the program from coast to coast for children 15 and under.

Children whose age does not exceed a limit by a participating bowling center are eligible to register for 2 free games each day of the Kids Bowl Free program, all summer long, courtesy of the participating bowling centers along with the schools and organizations.

The program is designed by bowling centers to give back to the community and provide a safe, secure, and fun way for kids to spend time in the summer

Parents do not have to buy the optional family pass to participate. But, they do offer a great deal if you do want to bowl with your kids but it’s not required. Each center is different. Some even offer an unlimited shoe rental pass for the summer.

For more information and to find participating centers, near you. visit kids bowl free at

Make Money Publishing Kindle e-books

Create and sell Kindle ebooks for amazon kindle and join the hundreds of thousands of writers making money selling kindle books. For fiction and nonfiction authors alike, publishing on Kindle is a valuable opportunity that shouldn’t be overlooked.

You can Self-publish eBooks and paperbacks for free by converting your books into electronic format with the Kindle Direct Publishing self-publishing tool. And you can sell them in the Amazon Kindle store and reach millions of readers on Amazon.

You can get your books to the market quickly and easily. Simply upload your content, enter the sales copy and pricing information, and in less than 5 minutes your book appears on Kindle stores worldwide within 24-48 hours.

And the royalty rates are great, you can earn up to 70% ebook royalties. Only there is one catch The royalty rate you get paid from Amazon for eBooks is 70% of the retail price if the price of your eBook is between $2.99 and $9.99. If your book is priced between $0.01 and $2.98 or greater than $9.99, you get paid 35% royalties.

On the upside according to Amazon’s 2019 review of its Kindle sales, there are thousands of self-published authors taking home royalties of over $50,000, while more than a thousand hit six-figure salaries from their book sales in 2018. What are you waiting for head over to the kindle direct publishing and begin earning money!

Free Money to Help With Internet Cost

The Affordable Connectivity Program is an FCC benefit program that helps ensure that households can afford the Internet service they need for work, school, healthcare, and more.

The benefit provides a discount of up to $30 per month toward internet service for eligible households and up to $75 per month for households on qualifying Tribal lands. Eligible households can also receive a one-time discount of up to $100 to purchase a laptop, desktop computer, or tablet from participating providers if they contribute more than $10 and less than $50 toward the purchase price.

The Affordable Connectivity Program is limited to one monthly service discount and one device discount per household.

Who Is Eligible for the Affordable Connectivity Program?

A household is eligible for the Affordable Connectivity Program if the household income is at or below 200% of the Federal Poverty Guidelines, or if a member of the household meets at least one of the criteria below:

-Participates in certain assistance programs, such as SNAP, Medicaid, Federal Public Housing Assistance, SSI, WIC, or Lifeline;

-Participates in Tribal specific programs, such as Bureau of Indian Affairs General Assistance, Tribal TANF, or Food Distribution Program on Indian Reservations;

-Participates in the National School Lunch Program or the School Breakfast Program, including through the USDA Community Eligibility Provision;

-Received a Federal Pell Grant during the current award year; or

-Meets the eligibility criteria for a participating provider’s existing low-income internet program.

How to Manage A Business Credit Card Account In GnuCash

It is not uncommon to use a credit card for some of your business transactions after all a credit card account is like a short-term loan that comes in handy when you have a business, but then you .eventually have to pay back the money, often with interest.

Credit card transactions are a liability because it is money you owe. In GnuCash The purchases you make with a credit card are classified as expenses.

You have a couple of options when entering credit card transactions. The simplest method is to only track monthly payments to the credit card company.

This method only requires you have a checking account, a credit card liability account, and a credit card expense account.

The obvious limitation of this simple credit card setup is that you cannot see where your money is going. And since you are tracking business expenses you want to be as transparent as possible, when it comes down to your business expenses. If not for yourself for tax purposes.

In the following tutorial, you will learn how to manage a credit card account in GnuCash to keep track of all your business credit card expenditures.