Are you still manually tracking and documenting your business expenses and mileage for tax purposes? Technology is calling your name! Here are four reasons why you should begin using expense tracking software to keep up with your tax deductible expenses so you can focus more on making a profit and less on tedious tasks we often procrastinate or forget to do altogether.
1. Save money
Over 80% of independent and small business owners overpay their taxes every year. That, according to the IRS.
However, over the past 8 years Deductr has studied user data for it’s automated expense and mileage tracking tool to find that Deductr customers save $93 per month on their taxes and that’s on the low end. Other customers show tax savings of over $700 per month!
If you’re not slapping your head yet — or if documented tax savings aren’t convincing enough — consider these other benefits that automation technology can provide.
Automation provides consistency. Consistency provides uniformity which helps eliminate lost or forgotten receipts making sure every potential tax deduction is documented for filing.
2. Easily manage tax compliance
Whether your business policies are dictated by regulatory compliance or internal issues, you’ll enjoy the peace of mind that automation provides.
Most automated platforms are programmed in accordance with standard reporting policies. And, most of the time, you can also customize features in order to reflect your internal policies.
For instance, do you to keep expenses below a certain threshold? Do you find yourself wondering about allowable mileage rates?
Most automated expense management systems allow you to have both customized and pre-populated fields. This way, when you enter expense items that are out of range or prohibited, the system can flag or reject those entries.
3. Free up valuable time
Manually tracking and documenting business expenses, including mileage, can feel like a full-time job. When you spend time sitting in front of a spreadsheet and typing in the numbers by hand, valuable time is lost.
Your time is much better spent doing what you got in business to do in the first place. With automated expense reporting, you’ll be able to dedicate your time where it has a greater impact.
4. Ease tax time pain
Manual expense tracking doesn’t just require a lot of time and energy during the year, it requires more of the same come tax time.
Gathering data, receipts, financial statements and everything needed to get your tax return ready to be filed can be a stressful activity. Too often disorganization prevails and the time spent hunting down needed documents can take a toll on your sanity.
Using automation means everything you need will be in one system and one place for easy access and application. Printing or emailing a multi-page report for your tax professional makes getting ready to file simple and less stressful.
Granted, human behaviors don’t always change as fast as technological advances. When you change from a manual process to a fully automated process, it’s important to carefully evaluate your expense management software options. Focus on vendors who have a proven track record.
As you consider your options for expense management systems, consider Deductr. Our expense management software makes tracking and reporting expenses easier than ever by automating and streamlining the tracking and documentation process, so you can leave the spreadsheets and headaches behind.