8 Simple Practices For Small Businesses To Organize Receipts Efficiently

Keeping a record of your business transactions is considered a top priority for a self-employed or small business owner. Keeping your records properly saves you from being audited by the IRS. Plus, staying organized will save you time during tax season. 

However, we understand that keeping track of all your receipts and records can be tedious and time-consuming. That’s why in this article, we’ve outlined eight best practices to help you organize receipts and records efficiently. 

1. Use a business account and credit card instead of cash

As the IRS will continue to enforce its audit rules, keeping a better set of bookkeeping and receipts for all of your expenses will help you save time and hustle. This simple yet important tip can help you cope with it. Avoid using cash — it’s easy to spend, hard to track, and nearly impossible to match up cash spent with receipts. 

On the other hand, a credit card or debit card will provide you with monthly statements, enabling you to cross-check details with your paper receipts. It’s also a good idea to have a separate business account and credit card, so you don’t mix business expenses with your personal spending. 

2. Save your receipts

Don’t just rely on bank statements, credit card statements, or canceled checks! The IRS won’t accept your bank or credit card statements to justify deductible expenses. You will need an itemized receipt that corresponds with the transaction. 

Hang on those itemized receipts, which are also called “source documents,” for at least six years after your last Notice of Assessment since the IRS will ask to see them in the event of an audit. You can keep a physical or digital version of receipts. 

3. Choose email receipts instead of paper receipts

Nowadays, many merchants offer this service to their customers. You can choose to receive your receipts via emails, label and categorize them in a specific order. Email receipts are convenient and friendly to the environment as they go straight to your inbox and clear your desk and drawers from piles of paper receipts. You can always find them easily, create expense reports, and do so much more. 

4. Review your receipts once a month

Spending some time reviewing, categorizing, and organizing receipts for 30 minutes every month can make a huge difference! It keeps things manageable as the year progresses and helps you keep track of your spending so that you won’t miss out on any tax deductions. 

You can purchase an accordion folder every year to store all business receipts and make sure each folder contains all receipts for the year. These folders are inexpensive and easy to obtain. They allow you to organize receipts by category and year, making it easier than ever to find any receipt even years later. 

5. Make notes on the back of receipts

This is an especially great idea to keep track of dining and entertainment expenses. It’s easy to recall why you bought a printer, but it can be difficult to suddenly remember who you went to dinner with and what the business purpose was in 2015. By starting this simple habit, you will rest assured that you will not miss any dining and entertainment expense deductions for business purposes.

6. Create a spreadsheet for work-from-home expenses

Whether you have always been working from home, or you are working remotely due to the Covid-19 pandemic, there will always be some noticeably deductible business expenses. These expenses include a portion of cleaning materials, utilities, home insurances, office supplies, along with part of your property taxes, mortgage interest, and capital cost allowance.

To claim these expenses, you need to calculate the percentage of your home used for business and apply that percentage to the tax deduction. Create a spreadsheet including your receipts for home office expenses throughout the year. By making it a habit to update the spreadsheet once a month, you’ll save yourself the headache of scrambling to input and tally up all your work-from-home expenses at the end of the tax year.

7. Back up your receipts

Since paper receipts tend to fade with time, keeping a digital copy of each receipt can save you from getting in trouble with the IRS. The simplest practice is to snap a picture of each receipt on your phone, then upload it to a central location later and keep it for at least six years. The IRS allows digitally stored receipts, however, don’t forget to back up stored receipts (on the cloud or a memory device) in case your hard drive crashes and deletes all your important information by accident. 

8. Scan and store your receipts digitally

Storing receipts digitally has been proven to improve business efficiency. It provides several benefits including time and cost-saving, easy to store and access, tax-ready, reduces clutter,  lessens the risk of data loss, increases security, and so much more. 

There are plenty of receipt scanning apps that you can use to scan and store your receipt digitally. Each offers special features for particular purposes, so anyone can choose the most suitable one and benefit from it. 

Shoeboxed is a painless receipt scanning and organizing solution for freelancers and small businesses owners. This versatile app serves many purposes: scan, store and organize receipts, manage business expenses, store business cards and even track mileage for business travelers. 

Shoeboxed’s OCR engine and human data verification features ensure that your receipts are legibly scanned, clearly categorized, and accepted by both the Internal Revenue Service and the Canada Revenue Service in the event of an audit. What’s more, Shoeboxed enables you to create clear and comprehensive expense reports that include images of your receipts. You can then export, share or print all of the information you need for easy tax preparation or reimbursement… within a few clicks. 

Shoeboxed is now available on iOS and Android. Get your free trial before choosing the perfect plan

Conclusion

Organizing your receipts can keep you proactive and productive, which saves you lots of time, stress, and even money in the long run. Going digital helps you organize receipts and keep track of your expenses easier than ever. As everything is digitally stored and accessible through a cloud-based system, you will be able to work with them anytime, from anywhere, with any device, within a few clicks. 

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PayPal vs. Stripe: Which Payment Solution is Best for Your Small Biz?

When you run an online business you may not know which payment solution to go with. We created this guide to help you decide which solution is easiest for your customers to use.

If you run an online business, you need to accept payments. But getting paid via an online portal has all kinds of challenges. You need to make sure your solution is secure, functional, and easy for customers to use.

You can have a web payment solution custom built for your site, but software solutions have already solved the biggests challenges, and you can buy their services for a reasonable price. Two of the most popular are PayPal and Stripe. Websites around the world accept payments from these two companies.

Today, we’re going to explore PayPal and Stripe. We compare the two on a number of factors– fees, security, APIs, and more, to help you discover which payment solution is best for your site.

What do PayPal and Stripe do?

PayPal and Stripe both accept credit card payments online and in mobile apps. Both solutions can be seamlessly integrated with an existing website. The two aren’t new to this game– they process billions of dollars every year, are two of the most trusted solutions for accepting mobile payment.

What’s the Deal with PayPal?

PayPal was founded in 1998 by Luke Nosek, Max Levchin, Peter Thiel and Ken Howery under the name Confinity. In 2000, Confinity merged with X.com, Elon Musk’s online banking company. Soon enough, X.com would focus exclusively on PayPal, which was generating significant interest and respect.

PayPal had its IPO and was bought by eBay for $1.5 billion in 2002, and became eBay’s default payment solution. Today, PayPal operates all over the world. It has become an independent company again, spinning off from Ebay. PayPal moved $228 Billion dollars in 2014 alone.

What About Stripe?

Stripe is much newer than PayPal, as it was founded in 2010. Founders Patrick Collison and John Collison created Stripe as a turn-key solutions for web developers who wanted to integrate payment processing into their websites. Stripe stands out from the competition because of how easy it is for software programmers to use.

Stripe received funding from Y Combinator in June 2010, and quickly grew. In 2014, Stripe landed a major partnership with Apple Inc. to help power Apple Pay.

Pros to Paypal and Stripe

  • Easy to use for non-coders
  • Extremely secure and the security isn’t on you
  • Customizable to your brand

Cons to PayPal and Stripe

  • Transaction fee charges
  • Not designed for brick-and-mortar locations

Paypal_Stripe Infographic_Shoeboxed

Other Web Payment Solutions to Check Out

PayPal and Stripe are two favoured payment solutions, but there are others that may better fit your needs. Here are a few worth checking out:

Authorize.net

Authorize.net is a comprehensive payment solution, allowing you to accept payments online, via mobile, or at a store. Authorize.net is a very high quality payment gateway, and the 24/7 support is unrivalled. Your customers can use any credit card, or even use PayPal.

Fees: 2.9% 30¢ transaction costs, $49 setup fee, plus $25 recurring charge

Square

Square is the best option for brick-and-mortar shops and in person transactions. You can accept every way your customers want to pay– chip cards, NFC payments, and MagStripe cards are all accepted. Square can instantly turn your smartphone or tablet into a cash register.

Fees: 2.75% per swipe or paid Square Invoice, 3.5% + 15¢ per manually entered transaction

Braintree

Braintree is a simple, robust way to accept payments or enable buying from almost anywhere — in your mobile app or online. On top of the full breadth of PayPal and Venmo customers, Braintree’s integrations give you access to multiple payment methods, simple pricing, security, and customer support.

Fees: Your first $50K in standard card processing volume comes fee-free. This applies to all card and digital wallet transactions not through PayPal or Coinbase. After you reach $50K, it’s 2.9% + 30¢ per transaction, with discounted rates available for businesses who process over $80k per month.

Recurly

Recurly is a payment solution specifically for subscription-based businesses. It cates to enterprise-level business, so isn’t a great choice for the little guys. Recurly is easy to use, and doesn’t require a massive integration effort.

Fees: 1.25% of revenue + 10¢ per transaction, Core Plan monthly fee is $99, Professional Plan monthly fee is $299.

Dwolla

Dwolla isn’t a typical payment gateway. It specializes in securely connecting with U.S. banks and credit unions to enable safe, fast, bank transfers. This is great if you’re constantly using bank wires.

Fees: No transaction fees for sending and receiving one-time, recurring, or mass payments. If you want to access Dwolla’s advanced features, you’ll need to contact the sales team.

This guest post was written by John Stevens, the CEO of Hostingfacts.com, a web hosting review site that boasts human edited and tested reviews of hosting companies from around the world.  He enjoys building websites, as well as experimenting with design and UX. 

Using Facebook Ads to Promote Your Business for Beginners

Tips and tricks for beginners on how to understand your audience, optimize your ad, and properly set budgets for your business Facebook ads.

Now that you’ve created a website and Facebook page for your business, it’s time to promote your business using Facebook ads.

First things first – when starting a Facebook Ads campaign you need to decide if you are going to drive traffic to a website or a Fan page. This will make a big difference in your strategy, and there are pros and cons to each.

For example, if you choose to link to a Fan Page, it will be easier to get an ad approved because you are not driving visitors away from Facebook (and Facebook really likes that). But on a Fan Page, you won’t able to engage and create leads with customers like you would be able to on your website.

Generally speaking, it’s recommended to drive traffic to your website and not to your Facebook page. There is more flexibility when leading customers to your own website. Ultimately, the decision should be based on what your goal is – do you want to create more leads and drive people to your website, or do you want to have more Facebook followers and create social buzz?

For the purposes of this guide, we will focus on creating a Facebook ad that links to a website.

Understanding your Facebook audience

Before creating an ad, it’s crucial to first understand your audience on Facebook, and there are two great ways to do that:

  • By digging into competitor Facebook pages or pages related to your industry
  • By analyzing Facebook groups related to your product or industry

Take notes on the kind of language, messaging and imagery used, and find a way to incorporate that with your own ad. For example, when browsing through competitor Facebook pages, see what kind of content is included in the most popular posts from their page. When analyzing Facebook groups, try to get into their heads. Learn how to approach your audience and understand their needs and desires by reading the conversations in these groups. What are their issues? How are they currently dealing with them? What are their interests?

People are receptive to content that they are familiar with, and information from both methods will prove to be a tremendous asset when creating an ad that resonates with your target audience.


Optimizing your ad and website for Facebook traffic

Once you understand your audience, use that insight to brainstorm creative ad ideas. Leaving a first impression with your ad is vital, so be sure to stand out by using strong headlines and powerful images. Try to pick an image that represents the mission of your business or product, but also something that resonates with your customer base. You want people to remember you. Social Times has a great article on Facebook ad creative best practices if you need some inspiration.

Next, you’ll want to make sure the landing page your ad links to is optimized. Once a customer clicks on the ad and is taken to your website, there should be correspondence between the CTA’s in your ad message and the content delivered in the landing page. Having a clean and professional-looking landing page will also help you optimize your landing page. There are dozens of websites and resources out there with tips on how to optimize landing pages.


Facebook Ads campaign – step by step

The first step when creating a Facebook ads campaign is to choose an objective. There are several options, but for the purposes of this guide you’ll want to pick “Send People to your website”.

Facebook Ads

After adding your website URL, the next step will be to set your audience and budget. Here you will use the information you previously collected when you were researching your Facebook audience.


Setting a Target Audience

Start by selecting a location. If you are running a local business you should select your city and surrounding areas, but if not you can start by focusing on your country. Note: don’t target a super large area or multiple countries – this will hurt your targeting and your ads may not be hitting the right people for your campaign.

Facebook Ads

After that, you will be sent to select very specific parameters for your audience like gender, education level, consumer behavior, family information and more. Facebook ads allow you to get very granular with audience targeting, but don’t spend too much time going through targeting options or you will run the risk of jeopardizing the reach to potential customers.

If the purpose of your campaign is to lead customers to your website and create sales and marketing leads, then a good way to start is to target people that are spending money online (ex. above 24 years old, has a credit card, etc).

And now let’s put the pieces together. There is a field called “Detailed Targeting” where you will want to add the Facebook pages you used when researching your audience. Here you will find two important fields: Exclude People and Narrow Audience. With Exclude People you can select people who like page A and don’t like page B, and on Narrow Audience you can pick people who like page A and page B. This will be immensely helpful for your targeting efforts – the more defined and targeted your audience is, the higher the click conversion rate will be.

Facebook Ads

When doing this, you will notice that your potential reach will decrease in an icon to the right. The potential reach is an important metric because it will help you set lower budgets.


Setting a Budget

Facebook ad budgeting lets you start at $10 per day! Analyze how many clicks you are getting, how much you are spending per click and if your visitors are taking the desired action to change your budget as needed.

Facebook Ads

When setting your daily budget you will also notice that your “estimated daily reach” will change. At this stage, it’s helpful to experiment and try different parameter variables to see if you can reach more people with the same budget. You will notice that just by changing the age of your target audience you can increase your reach at no extra cost.


Creating your ad

Note: even if you are driving traffic to your website you are going to need a fan page to be linked to your current ad campaign.

This stage is pretty straight forward. And to create a great ad you must use the knowledge you acquired when researching your audience. You can start by selecting your image. Remember, pick the type of image that is popular on big Fan Pages and don’t forget to use your logo to customize the image. If you don’t know how to do that you can use a tool called Pixlr.com (among dozens of other internet tools) that can help you edit images to make them look more professional.

You are almost done! Just add a headline based on your promotional research (refer back to the beginning of this article) and use a text that relates to what you read on Facebook groups. This will help you to get a low cost per click and increase your click through rate. Those two metrics go hand in hand, so always keep your eye on this.

After that, you just have to choose the placement:

  • Desktop New Feed
  • Mobile New Feed
  • Instagram
  • Desktop Right Column

You should test each placement to see which will perform better. And remember: the main two metrics to control are CTR (click-through-rate) and CPC (cost-per-click). To optimize the campaign, always start by changing the image, then headline and only then should you change the text. This is one of the best methods to get started on Facebook ads. It will help you understand the platform, see how things work, understand your audience and give you a chance to improve your metrics in the middle of a campaign.

This article is a guest contribution from Felipe Kurpiel, an internet marketer with a passion for SEO and affiliate marketing.