I just finished my taxes this weekend! Yay!
The last time I tried to do my own taxes — i.e., without any help, electronic or otherwise — was way back in 2005, when B. and I had a side business doing wedding photography and therefore had to file a Schedule C. Oy.
I think it took me just over seven hours doing and re-doing the paperwork, but each time I would come out with a different amount that we owed to the IRS (none of them good, of course). Frustrated, I called my brother (naturally, this was a day or two before April 15th), who then asked me why the hell I was attempting to do it without TurboTax.
I couldn’t give him a straight answer, other than the lame-o one that I liked doing things the hard way. (I’ve since changed my tune and now generally seek out the easiest possible means of accomplishing something.) I gave in and downloaded the software program from Intuit’s Web site. Two hours later, voila! I had our labyrinthine tax form printed and e-filed with the revenue folks. Sigh.
Since then I’ve been very, very good about ferreting out other programs that promise to make my personal and professional financial lives so, so much easier. I can’t remember how I stumbled across Bootstrap (now Outright.com), but it’s been a huge blessing. The program is free and caters exclusively to small businesses like mine. It offers a very simple and straightforward interface, with tabbed pages for Income, Expenses, Taxes, and Reports. The Income page, for example, allows you to enter the payee’s name (e.g., Grand Junction Free Press, where I write a weekly column), the amount of the check, and a section where you can include, say, the check number. On the Expenses page, you can enter the vendor’s name, the amount of purchase, the item/service purchased, and also allows you to categorize the expense on a dropdown menu of standard Schedule C categories.
You can always see where your business is by clicking on the Reports page, which gives you a running total of income and outgoing, as well as a category breakdown of where your expenses are. A simple click of a button gives you the opportunity to export all that cool info into an Excel or OpenOffice Calc spreadsheet.
Recently, the good folks over at Outright teamed up with another online software program called Freshbooks, which I now use to create and send invoices. When I send out an invoice, Freshbooks links it up automatically to my Outright account so that when I open the latter, I can immediately see what invoices are outstanding (which I can also do, of course, via Freshbooks). When the payment on an invoice goes through and I record it on Freshbooks, the latter automatically sends that info to my Outright account so that it shows up on my Income statement without my having to manually enter the info myself. How cool is that?
(Caveat: I do pay for Freshbooks, to the tune of about $14/month. The really basic service — called “Moped” — allows you a maximum of three clients. Since I have a bit more than that, I opted for the 2nd tier service — called “Shuttle Bus” — that gives me a max of 25 clients. Totally worth the price, considering how much easier invoicing has become, compared to the spreadsheet model I used in the past. Plus, it’s deductible!)
All this automation has made my bookkeeping life so much easier. I did my taxes this weekend, and it only took about three hours on TurboTax. It would have taken a bit less time, but here’s where Outright is a little behind the times:
a) It doesn’t (yet) allow you to enter mileage information anywhere, so I have a separate Calc spreadsheet that tracks that info.
b) More importantly, it doesn’t exactly jive with the IRS’s Schedule C. The biggest example I could think of is that C has a line-item for “Communications” for things like Internet connections, wireless access, and cell phones. On Outright I’d been putting that under “Office Expenses,” but when I saw that C has a different category, I had to extract my cell phone charges from the “Office Expenses” amount and insert it into “Communications.” I then had to make sure that the “Office Expenses” line on C had the accurate number, minus my cell phone charges.
It’s a minor thing that I’m sure Outright developers will remedy this year, but it does mean having to re-calculate some Sched C items. Still, it’s a small price to pay for having a simplified bookkeeping system that meets my needs as a very small business owner.
I’ve written about Outright before (back when it was called Bootstrap), and I’m still totally in love. If they fix that little glitch with the missing Schedule C items, it’ll be perfect.