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2h • Communities
Bookkeeping vs. Tax Preparation — Not the Same Thing
Over the past couple of days, two of my tax-preparation colleagues told me the same story.
People approached them, saying, “I need someone to do my taxes.”
But in reality…They didn’t need tax preparation yet.
They needed their finances in order first.
If you’re an entrepreneur or small business owner, there is preparation required before you walk into a tax preparer’s office.
You should know:
- Your total revenue
- Your total expenses
- Your expenses categorized (marketing, office supplies, equipment, subscriptions, tools, etc.)
- Your Profit & Loss report
Bringing a box of random receipts to a tax preparer is:
❌ Unprofessional
❌ Inaccurate
❌ And sometimes VERY costly
A CPA colleague told me a potential client brought in a box of receipts and records.
The quote to compile everything and file the taxes?
$8,000.With at least half paid upfront.
That’s what happens when bookkeeping is skipped.
Here’s the difference:
📊 Bookkeeping = Organizing and categorizing your financial data throughout the year.
🧾 Tax Preparation = Using organized data to file accurate tax returns.
Tax preparers don’t clean your books.
They file based on what you bring them.
Clean books lead to:
- Lower tax prep fees
- Lower risk of overpaying
- More confidence
- Better financial decisions
Please take the time to understand the difference and your responsibilities as a business owner.
If you have questions, I’m happy to chat.
Or you can try the DBR Bookkeeping Community FREE for 7 days and learn how to get your books organized the right way.
Let’s start Doing Business Right.
DBR
POLL: ARE YOU READY FOR TAX SEASON?!?
My Taxes are DONE! No stress here :)
Almost! I have my stuff together, I just need to get an appointment scheduled with my tax preparer.
I am NOT ready... I still need to get all my information together!?!?
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Bookkeeping vs. Tax Preparation — Not the Same Thing
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