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70: Staying Organized for Tax Season & What Systems to Put Into Place for Your Money

Staying-Organized-for-Tax-Season-&-What-Systems-to-Put-Into-Place-for-Your-Money

There are two types of people in the world: those on top of their tax prep and those who want to skip right over this podcast episode. Before you run off, let me introduce you to Jackie Easterday. In this episode, Jackie breaks down the stigma around accountants being intimidating or scary and answers my burning questions before I started working with her. If you are ready to take notes and confidently walk into the next tax season, this episode is for you!

The Systems and Workflow Magic Podcast is brought to you by Dolly DeLong Education. This podcast is for creative business owners who want to learn tangible steps to automate their business through workflows, systems, tools, and strategies to go from scattered to streamlined with purpose because even muggles can become automated wizards.

Meet Jackie Easterday

Jackie is a CPA and helps stressed-out, overwhelmed business owners get control of their finances, organize their books, and file taxes without tears or frustration. Her mission is to make small business accounting simple, approachable, easy, and, yes – even fun!

Jackie has been helping small business owners manage their books and file taxes for over a decade. She spent a few years in public accounting after earning a bachelor’s degree in Finance from the University of Texas and her master’s degree in Accounting from Indiana University. Once she had her boys, she realized she wanted more flexibility and time to spend with her family, so she started her own small business in 2016!

Since then, Jackie has mostly worked with online service providers. Her clients appreciate her unique mix of experience, knowledge, and laid-back approach. You can feel comfortable asking her anything. She doesn’t believe in dumb questions, but she does believe in empowering small business owners with the knowledge, confidence, and numbers they need to make the best decisions as they grow and scale.

WANT A RESOURCE TO BEST STREAMLINE & AUTOMATE THE NUMBERS BEHIND YOUR BUSINESS?  

I have created an easy-to-use template that will help you take control of your finances because you will have clarity and confidence in knowing where your money is going!

Develop a system and workflow that works FOR your finances (and one that isn’t confusing)!

Check out The Bookkeeping Template For Creatives and use code PODCAST for 20% off!

Review the Show Notes

My experience working with Jackie

Why Jackie started her business and chose to work with female small business owners

Strategies to Increase Tax Prep Efficiency

Tips for Setting Up a Business Bank Account 

Behind the scenes of Jackie’s CFO days

Jackie’s receipt process for the organized, but scattered entrepreneur

Prepaying your taxes quarterly to avoid being dinged

Everything you need to know about 1099s and paying contractors

Jackie’s opinion on tax write-offs 

LINKS MENTIONED

Grab Jackie’s Service Guide >>

Check out The Bookkeeping Template For Creatives and use code PODCAST for 20% off!

CONNECT WITH JACKIE ⬇️

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CONNECT WITH DOLLY ⬇️

instagram.com/dollydelongeducation

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Staying-Organized-for-Tax-Season-&-What-Systems-to-Put-Into-Place-for-Your-Money

REVIEW THE TRANSCRIPT:

Dolly Delong
Hey, Systems and Workflow Magic friends. It’s Dolly, your Systems and Workflow Magic BFF. I am just popping in here to let you know that this is going to be a repurposed episode meaning I am re-sharing this episode about how to create systems and workflows for the finances of your business, especially with tax season just around the corner. I am interviewing my CPA, Jackie Easterday. This episode actually aired in 2022. And it’s a very popular episode because Jackie really gets into the systems and workflows of finances and just how to be ready for when tax season comes. So I know that tax season is around the corner for many of us, especially those of us who are listening to this live, April is around the corner. So I hope this is an encouragement to you to just get your systems in place for tax season and especially as a creative business owner and not to be stressed out about it, but just take one step at a time. So again, I hope you enjoy this very popular episode featuring Jackie Easterday, who is an incredible CPA by the way, enjoy. All I can say is if you are listening to this episode live, meaning it’s the month of April and as many creative business owners know all business owners know this is tax season. So I sincerely hope you are surviving tax time and it’s not wearing you out too much. And again, if you’re listening to this episode in the future, and you’re listening to let’s say in December or November, then I really want you to still listen in and take notes because I am interviewing my amazing CPA, Jackie Easterday to chat all about taxes and how to set up systems for yourself and just how not to be intimidated by tax season, especially as a creative business owner before we dive into this not so sexy yet sexy topic. Jackie, can you please introduce yourself to everyone?

Jackie Easterday
Yes. So first, I’m super excited to be here. Dolly is one of my favorite people to follow on Instagram, honestly, like she is a dubsado Wiz, we all have our zones of genius. I have like honestly, some of your tips and tricks that you have posted have saved me and automations. So I’m very excited to be here and share some of my tips and tricks with all of your listeners and your followers. Because there is a lot that revolves around taxes in the know about me. So I’m first and foremost, my mom, I have three boys, I have a nine-year-old and twins that are seven, coming from a family of all girls, it’s a total adjustment. And I’m sure you get that being a boy mom like my house is loud, all the things are messy, all that stuff. But honestly, and my husband is I would say almost probably even like the backbone of my business like having a solid support system, just to encourage, and you get this, encouraged you to go out of your comfort zone and expand your business and grow. (f it wasn’t for him, I would be right now truly sitting in an office somewhere probably on my 80th day of my 11-12 hour tax season day. So that is my background. I am a CPA, which is fancy for I have a Degree in Accounting and I eventually took a bunch of tests to become a Certified Accountant. And I specifically work with female online business owners from Creatives to VAs and OBMs and website designers, really to help them simplify and understand the money side of their business. When I was in public accounting, I worked primarily with small businesses, and honestly, that’s really where I found my passion for getting to meet other small business owners and just everybody’s got something different to offer. So it was super exciting, and kind of just transition me into where I’m at now. So that’s kind of where my focus is.

Dolly Delong
I love it. So I mean, I’m going to be sharing how I found you, but I’m just so happy. You’re you really are going to help so many creative business owners, with your words of wisdom, and I’m so excited about what you’re going to share today, Jackie. So I just wanted to share with everyone that Jackie has quite literally transformed the numbers behind my business before Jackie, I was working with an accountant. She did her job, I told Jackie she did her job, but she really wasn’t as that interested in her clients as Jackie has invested in her client. I’d never want to sound negative on this podcast. But there was a clear distinction when I hired Jackie in comparison to my past CPA. It was so clear that Jackie is amazing at what she does. So I told Jackie, I think it was like a month ago when she was helping me out with my taxes. I was like, “Jackie, if I go to prison, will you at least email me Like mail me something like me?”, and she’s like, well, first of all, you’re not going to prison. And then you were like, I think you’re like, yeah, yeah, I’ll keep in touch with it, I like still support me. But she just held my hand the entire time, sometimes verbally had to walk me off the ledge because I just freak out about all things taxes and I’m sure that there are many other creative business owners out there who feel the same way. But one of our mutual friends, internet friends, Emily Conley of Emily Writes’s Well, actually told me about Jackie, and again, even though I was using a past CPA, once I got into Jackie’s world, she went above and beyond to serve me and Ty, which is a really, really big deal for me. And she’s probably gonna laugh about this. She doesn’t know I’m saying this, but she dumbed everything down to a third or fourth-grade level for me and walked me through all the steps that I needed to file for my business and for our joint family taxes because my husband works for a company, but then I work for like, I own my own business. So in my mind, that was overly complicated but after working with Jackie, she really helped me out so much. So anyways, I’m just so excited to have her here, because she really did break everything down into a system for me and that helped my brain out tremendously. So thank you. This is like me thanking you for the millionth time, Jackie, I’m sorry, to scare you with other people and for you to walk other people off the ledge, get other people off the ledge and stop being so afraid of taxes and finances within your own creative business.

Jackie Easterday
I’ve laughed. No, I honestly the amount of people that say to me, like I don’t want to go to jail. And honestly, you’re not going to jail if you’re not. First of all, probably none of us are making the amount of money that the IRS is like watching us. But second of all, I mean, you have to like maliciously do something. You can get dangling interest and penalties which suck just as you know, as bad honestly. But I always laugh when people say that to me. Well, I have some awesome things that I want to share with you guys. Like I said earlier, Dolly provides constant tips and tricks on automating your business in your systems. And there are some things out there that will just make tax season so much simpler for you. And this is the time to do it. Because we just got over tax season you went through it. And I bet most of you are vowing to never have to go through it in that way again. So one thing I want to back up. So why did I get into taxes, like I said, I worked in public accounting, and I worked with all these small business owners. I would watch these people and they make their own schedules, their own rules, and their own money, and I never really thought I would be one of them. But I always kind of thought awesome is that like they’re answering to themselves, what flexibility they have, and here I am. And I’ve been able to do that by growing my business with a lot of the tips and tricks that I’m going to share with you guys. And that’s why I’m so passionate about working with female small business owners because I have found the flexibility to be able to have my own business and be a mom and be a friend and do the things that I want to do. And understanding your numbers, which taxes are a huge part of that, is what’s going to give you the information and the tools and the knowledge to grow and expand and gain that flexibility. And that, you know, looks different to everybody, right? Like everybody’s got different ideas of kind of what the end game looks like. But whatever that is, you have to plan to get there. And taxes are a huge part of everything you can’t escape, everyone’s got to pay taxes. I mean, you could escape them, but I promise you, at some point, the IRS is gonna find you and you’re not going to like find out. It’s the necessary evil of being a business owner and as Dolly said, they’re terrifying to people, because they’re super complicated, and they seem impossible to understand. And there are people like me who went to school to understand them. So it seems almost unfair that the average person who doesn’t have that background has to do this. So I want to talk about some of these things that are going to make your life so much easier. And the very, very, very first thing that you need to do is open up a business bank account, I get this question all the time, like I’m just starting out or I’m small, do I really, really need a business bank account? And the answer is 100%, yes. Because the sooner that you start separating your business finances, from your personal finances, your life is going to be so much easier. And I’ll give you some examples. Because if you don’t, what happens during tax time and many of you know this, you pull up your bank statements and your credit card statements from your personal accounts and you are literally going month by month, highlighting Canva subscription, that Dubsado subscription, that invoice that hit, and you’re gonna miss things you’re gonna miss deductions that would have saved you money on taxes or could potentially miss income which could cause an issue down the road, things like and so accuracy you know, it is really there’s so much human error and just spending hours coming through statements when it’s painful. No one has the time or wants to do that. But two very rarely is it probably accurate. I promise you, you miss something so the sooner you can separate those were, and then look at one statement. And no, all of these transactions are business, this is all my business income. These are all my business expenses, whether it’s a business bank account, maybe it’s a credit card, maybe it’s two bank accounts, just having it separated, is the very, very first thing, but probably the most important thing you can do for your business. And along those lines, a lot of business owners think they have to become an LLC before they get a business bank account and you don’t at all you can get a business bank account under your social as a sole proprietor. So if you are not ready to become an LLC, or you feel like I don’t know if this is going to work, I don’t want to go down that route, like you can 100% go in as a sole proprietor with your personal information and open up a bank account. So when did you open yours? Dolly? I know you’ve got a couple of things open.

Dolly Delong
Yeah, so I actually just applied for an LLC, I don’t know how to phrase that, the year that I went full-time in my business. So that was 2018, yep.

Jackie Easterday
And I think I will say, you know, I have been doing this on my own since my boys were little. And then when I first started, I just had one or two small clients, and I didn’t separate had one or two checks that came in and deposited them very few expenses at all. If you are going to continue your business, and you know you are, then, that first and foremost is the most important thing I think you can do.

Dolly Delong
I already know this for myself. But do you have any recommendations for banks for creative female small business owners, I know for sure my husband listens to this, but if any male listeners are listening, do you recommend any specific banks? Or what are your suggestions?

Jackie Easterday
Honestly, I think that, I tell people kind of off the bat, go for ease. Every bank has a different platform and different options. And all of our minds work differently. So research, some banks are more online-driven and people love that, some people want to have the option to be able to go in person. So it’s kind of preferential but honestly, I tell people, like I said go for ease. Guys, my business accounts are with the same bank that I have my personal accounts. For me, that’s easy, because part of my process, which we’ll talk about is transferring money monthly to taxes, to myself, and things like that. And it’s really easy to do that when everything is connected and linked, you know, the same bank, but some people don’t, they want to have things separate. So it’s really preferential but honestly, Chase and Bank of America have fantastic business credit cards. So that’s a great option with you know, solid rewards. So maybe you want to find somewhere back into it by looking at credit cards, and you bank with Ally, then you love them. And so again, it’s just it’s really preferential but I think figuring out what’s important to you and your business, and then kind of backing into it from there. But there’s not a right or wrong answer, just open.

Dolly Delong
Gotcha. No, that’s so we got open up a bank account. Yes. Bank Account separate from your personal account?

Jackie Easterday
Yes, okay. And then the next thing and honestly, this is the most important is monthly, monthly, track your income and track your expenses. So many people put this off, let the money roll in, let the money roll out, and don’t look at anything and they just pay attention to their bank account balance and figure Okay, well, I’ve got this much in here, this is probably what I made, you need to be tracking all of your transactions. So whether you want to track it in Excel or Google Sheets because you’re just starting out and you don’t really feel like you’re ready to invest in QuickBooks or software, that’s completely fine, you just have to do it. What I recommend for everybody is to wait for the month to close and the very beginning of the next month, sit down whether you’re in QuickBooks, and you’re going to be classifying and categorizing all your transactions, or you are opening a spreadsheet and go have your bank account open and list all of your income, list all of your expenses that come out and then figure out what your profit is. Obviously, there’s more manual work to do if you’re doing it in Excel or Google Sheets, and again, possibilities for hope, human error, or just missing something. But if you use an accounting platform like QuickBooks, it pulls in all your transactions for you. It’s just a matter of getting things classified and inappropriately and then looking at your monthly profit. Because this is important for two reasons. One, if you are tracking this stuff monthly when it comes down for tax season, in January, you do your December, bookkeeping, and then boom, you’re done. You know, a day you’ve got your books and your profit and loss already for your CPA or for TurboTax or however you’re filing. There is no scrambling to try and figure out what this expense that you paid last February was for because that’s really, really hard to do when you’re running a business to go back and try and remember. What was this for? You know what I mean? So staying on top of it is super important.

Dolly Delong
So would you recommend having a CEO financial day or like just a financial day for several hours at the end of the month? Or at the beginning of the month?

Jackie Easterday
Yes, I absolutely do. So honestly, that’s what I do for myself. I figure out a day. Ideally, it would be early in the month because then you can start to look at your numbers and have something to kind of make you know, maybe you’re spending too much and you want to course correct really quickly. It’s hard to do that when you’re three weeks into the next month. But sometimes life happens and it happens later. But that’s what I do, is go in and focus on your numbers. Call it a CFO day, pull up QuickBooks, pull up your bank statements, review everything, and look at your profit. So what I do personally, is I open up QuickBooks, I go through, I classify all of my transactions in QuickBooks, and I tie everything out to my bank and credit card statements to make sure it’s accurate. Then I look at my numbers, I have customer reports created so I can look at my profit, I compare it to previous months, I compare it to this time last year, and then from there, I look at my profit. I know okay, I need to be earmarking money for taxes. 30% is usually the rule of thumb, come some people more, some people less just kind of depending on your other income thresholds. So my monthly profit, say was $10,000, I’m going to immediately I’m going to look $3,000 of that 30%, I’m going to transfer to a business savings account. That’s called my tax savings. Now I have checked the box I have saved for taxes, and that’s earmarked, I’m good to go. Then that remaining $7,000 left of my profit. That’s what you start to think how much of that what do I want to pay myself? What do I want to leave in my business, and then I also so during that time, then I’ll figure out how much I want to pay myself, and I’ll transfer that amount. Then I will also you can open up business savings transfer the remainder if you want to, or leave it in your checking, kind of whatever you want to do. And then the final thing I do is I always at that point in time, go ahead and pay my credit card bill for the month, everyone has different due dates, mine isn’t until the 15th. But I go ahead and schedule it for that day, it doesn’t come out till the 15th. But then I’m done. Like all of my accounting for the month, I’ve looked at everything I save for taxes, I’ve paid myself, I’ve scheduled my credit card payment, and then you can just push the rest, you know, you don’t have to be paying attention to your numbers like that for the rest of the month. So I honestly think one day dedicated to diving into everything, you’re gonna get it all done. And it’s honestly the most efficient way to kind of have things going.

Dolly Delong
You’re probably gonna go into this and other points, I just thought of in this question. I know, we are mostly digital. What about the business owners? I get a physical receipt like they make a purchase. How do you recommend tracking the receipts? Because I know, for me, I’m weird, like I’m organized, but then I’m very scattered at the same time. What do you recommend with like a receipt process?

Jackie Easterday
So this was my next thing is done all of this. So I’ll kind of back up a step. Why do I need to track receipts? People are like, I don’t want to hold on to this $7 Starbucks charge or whatever. What can happen is if you were ever to get audited, and you can get audited for two reasons, they could look at your return and say something looks off, I want to audit you or you were all subject to random audits. If the IRS were to audit you, they might, they would look, you know, we’ll just talk about the business side, they’ll look at your business, profit, and loss. And they’ll say okay, well, you said you had $1,500 in meals in 2021. Show me receipts that total $1,500. So if you are tracking every month, you have your transactions, and you can verify that you have a receipt for every transaction, you’re golden because you can keep, you know when they need that you just know you can pull up that file, and you have it all documented. And you’re not like going back, you know, five years ago and trying to find receipts or things like that, because I’ve helped some small business owners through random audits. And they’re just stressful because we don’t maintain receipts like that so adding that piece to your monthly process is so huge because it’s going to give you complete and total peace of mind around your taxes because you’ve got documentation to support and the IRS will not allow like a bank statement or a credit card statement, that’s not a receipt. A receipt is an actual transaction, exactly. And so what I do is, for me, as 90% of my receipts come through my email, you know, the monthly subscriptions that you ignore, like, Hey, thank you for your payment of $12.99 or whatnot, or I pay contractors, those are all those receipts are going to come through email, I save all of those to a folder on my Google like in my Gmail, and then what I’ll do is typically on a monthly basis, and I’ll be truthful, sometimes this happens quarterly, download all of those and put them in Google Drive and just make sure I’ve checked all my boxes. And what I also do is if I ever have like a physical receipt, like you said, like, typically it’s going to be meals, if you’re meeting anybody in person, then I will honestly take a picture and email it to myself and put it in that file too, just because.

Dolly Delong
I do that, that makes me feel so much better about myself, okay.

Jackie Easterday
There are so many apps out there for receipts, QuickBooks, you can actually add a receipt to every transaction in QuickBooks. So you can upload receipts, you can scan pictures, you know, with the QuickBooks app and send them to yourself, things like that. So everything is appropriately classified and has documentation behind it. And on top of that, there are just a million other apps out there. I keep it simple just because for me, simplicity is the easiest thing otherwise, I’m not going to keep up with it. Some people that way techier and they want all the, you know, widgets and apps and things like that. But as long as you’re tracking them, that’s what matters.

Dolly Delong
Yeah, I always feel like a 90-year-old woman at like, I don’t know, like Starbucks, whenever I go out in between either sessions or get a meal before my photography session, or I’m like doing a VIP Experience Day for someone and I’m grabbing them a meal or whatever. And I asked for a receipt and like, people’s looks at me, like, you want a receipt. And I just want to be like, I’m so sorry. I am sorry, this is for my business. But it’s just like that look, for me, I’m like, please, I just need this for business.

Jackie Easterday
I know, I know. And I don’t ever get receipts personally. So it’s not like I have to remind myself, you know, I don’t know, I need to track this. And that’s why I love like, you know, Square app has so many of the options just like text you a receipt or email it to you or whatever. But yeah, for me, keeping it all in my Gmail is the easiest thing because I know I’m not, no one has time to like scan a receipt on a Tuesday from a meal, get it into Google Drive that day, and you’re going to forget about it. And then no one wants to scan 40 receipts at the end of the year. So for me, that’s the easiest way to at least know it’s somewhere. And then when I have time, I can kind of pull it all together.

Dolly Delong
Okay, I love that so much. Oh, man, this is also helpful. I’m writing notes too.

Jackie Easterday
So that is sort of what the monthly process looks like. As I said, block off the day, track everything, review everything, save for taxes, pay yourself, pay your credit card, and check your receipts, and then the other piece that you really need to focus on for accounting and for taxes is quarterly. So quarterly, you have estimated taxes, not everyone has to pay them. They are confusing, but the gist of it is they want you to prepay the money that you’re going to owe them, that’s what it boils down to. Is they don’t want to wait until tax day to get what you owe them, so when you were an employee and you worked for a business, you had wages, they took out your withholdings, your taxes, and they went ahead and on your behalf pay those into the IRS. So the IRS was getting their money ahead of time, just out of sight out of mind. We don’t know what’s happening. But now as a business owner, we’re not paid that way. And so we have to pay that money in and so the IRS says okay if you don’t have withholdings, you need to pre-pay us your taxes quarterly. And the long and short of it is they base that off of your prior year’s taxes because you don’t know what you’re going to make. There are all these complicated calculations on penalties and interest. But the safe rule is to pay 100% of your taxes for the prior year, throughout the year. So like you, for example, y’all have, Ty has some withholdings and so that’s going to cover some of that. But then if not, you need to pay in, you know the difference on a quarterly basis. So typically, when you do tax prep with the CPA, they will look at those numbers for you and provide you with the upcoming year, what your quarterly payments need to be. So I add this into your quarterly checklist or responsibilities to figure out what that quarterly payment is, like I said, if you worked with a CPA, you’re going to know that number and then schedule those payments to the IRS into your state. And if you’re saving monthly and putting that money into a tax savings account, those payments can come right out of there. So it’s very, very streamlined and simple. But that is a piece of the process that you want to stay on top of. And it is very important for tax time because you can get dinged if you have not paid in.

Dolly Delong
Well, I’m so glad and just like again, affirming how organized you are. You even send out reminders to all your clients like hey, your quarterly, estimated tax payment is due around this day, so that’s very helpful for me.

Jackie Easterday
Yeah, and I think it’s so important to find somebody who is going to jive with the way you’re thinking and give you the reminders you need. And just you know, taxes aren’t necessarily a one-and-done process. They are, it’s a project. But there’s stuff that you need to be doing throughout the year to kind of stay successful and set yourself up for an easy tax season. And so that’s very important. And that’s really the main quarterly piece and then annually, and I’m kind of talking generalities for small business owners, but annually, obviously, you need to file your taxes. But then, it’s the whole 1099s for contractors, so part of my annual checklist that I typically give people is if you have contractors that need 1099s, those need to go out annually as well. And if you’re kind of checking all of those boxes in the monthly quarterly and annual piece, you’re totally set you’re not scrambling in April to pull together receipts and things for your CPA, and you’re not realizing that you should have sent a contractor 1099 for $1,100 and that was due in January, you’ve already been staying on top of all up and it’s just going to streamline knowing what to expect I think is the most important thing to not be fearful. When we’re unsure of the unknown, whether that is taxes or anything health-related things, anything. That’s where we you know, the anxiety you can kind of reach out to me, knowing you’re checking the boxes and you’re saving, and you have an idea of what’s to come, it’s going to alleviate so much anxiety because you there isn’t as much unknown anymore.

Dolly Delong
I do have a question about the 1099 for contractors, like is there a minimum amount per week or per month that relates to the 1099? Because let’s say like, you are starting out with like hiring somebody for two hours a week versus hiring somebody out for 10 hours, is there like a minimum hour, or it just doesn’t matter.

Jackie Easterday
It is $600 for the year. So if you’ve paid somebody less than $600, you don’t need to issue them a 1099. And if you pay them through, they invoice you through Dubsado, through HoneyBook, QuickBooks, or through Wave, they send you in, through PayPal, they send you an invoice and you pay through their payment processor, you don’t need to send them a 1099. Because those payment processors are the ones that have to send the 1099s because the 1099 is basically a way to let the IRS know these people made money so they can get taxed on it. The only way you need to tell, is that all the payment processors, Stripe, HoneyBook, and Wave are going to take care of that. But if you paid somebody through Venmo, Zelle, or wrote them a check, a way that there would be no system for the IRS to know, that’s when they want to know. That’s the way to think about it.

Dolly Delong
Oh, that’s so good. Okay, everybody rewind back five, that’s really good. Because this is something that, I’m sure it frustrates you since you work specifically in numbers and taxes. But it frustrates me, and this might be an unpopular opinion. But around tax time, like you get on in Facebook groups, and everybody has an opinion about numbers, and they’re not even qualified to talk about numbers. It’s just like, well, this is what my cousin’s brother’s sister’s aunt said, but in my mind, I’m like, are you even qualified to share this opinion?

Jackie Easterday
I think every year the IRS is actually trying to simplify the 1099 process. But what I see is it feels more complicated, because people are giving their opinions or reading uncredible sources online, telling you what needs to happen. And so there they are, they’re cracking down even more like next year. Like for example, this year, if you work with a payment processor, like Stripe, Stripe doesn’t have to send you a 1099 until you’ve had like over 40 transactions totaling over 20 grand. So if you just had a couple of transactions, or you moved over to Stripe or HoneyBook, or some one of those, like mid-year, you won’t get a 1099. Next year, that number drops to $600, too. So everyone’s going to start getting more and like Zelle, Pay Pal, they’re going to start cracking down on sending those. And so the other thing that’s really important here is if you are paying people via Zelle set up a Zelle, not Zelle, Venmo or PayPal, like set up business accounts, because Venmo has Venmo Business and then all of a sudden Venmo is going to start tracking those 1099s. And so it just makes your life easier if you can. And that kind of goes back to the very beginning, I see so many small business owners who have separated their business, and finances, but still are utilizing a personal Paypal account or a personal Venmo account. And it’s so easy to do. But like break that apart. And all those all of those platforms have business options. Now,

Dolly Delong
I don’t use Venmo to pay anybody but is there for their business platform is there. You know, like with stripe and square, there’s always a transaction fee, like just the cost of doing business? Is there a fee associated with Venmo?

Jackie Easterday
I don’t even know to be honest with you, because most of my clients, I don’t use Venmo, for business at all. But I think it depends on how you’re paying them. So I think the bank-to-bank transfers are similar to Venmo, personally or not, but like if you’re utilizing credit cards or things like that, then they will. But just and that kind of all of that kind of goes back to just adding another system when you’re paying people outside of a contractor who’s invoicing you or something like that tracking those things. And getting so a W-9 is a form you can google it that is, if you have to pay a vendor, you hire a VA or somebody that you’re paying, you know writing a check or something like that. The W-9 is where they input all their information, their social security number, and their address, that’s information, you need to issue them at 1099. I absolutely recommend before you send that payment, ask them for their W-9 because it might be somebody that you work with in February, and maybe you pay them two grand but then you don’t work with them again for the rest of the year. Maybe it’s just for whatever good or bad. And then now you are almost 12 months later asking them for a W-9 they’re not, they have no incentive to give it to you and it just makes your life harder. So kind of staying on top of those things will absolutely make things easier for you.

Dolly Delong
Okay, gotcha. No, this is all really good to have a system for paying people. What is you are working with like, you have a system for paying people. But what if you’re working with like, I don’t want to call them difficult, but just like people who don’t want to say refuse to have a system, but just like, don’t have a clear way of being paid? How do you handle that?

Jackie Easterday
So I think if you work with somebody who is not, they don’t have a system for how to get paid like they don’t have solid invoicing or something like that, I one, you should absolutely ask for an invoice, not email, I don’t care. I mean, I have, you know, I recommend some people, even if somebody won’t give you an invoice, draft one in Excel, send it to them to send to you because you want that invoice for your purposes, that’s your receipt, you know what I mean? What I was talking about earlier, so one, get an invoice, and two, then that’s where you set up your system. So if they don’t have a system for how to pay them, then you say, I pay my contractors, you know, via whatever you however, you know, I pay my I write you an E-check, or Zelle, or you know, there’s awesome like payment platforms like Gussto, or things like that, that you can set up contractors with. So if they don’t have a system, that’s where you need to have a system that comes right into play that way, you’re not paying some people through Zelle, some people through Venmo, some people with a check, if they don’t send you an invoice, you have a system in place for how to pay them. And you tell them kind of like that’s the way it’s gonna be.

Dolly Delong
Yeah, because I like for my photography business, I do work with other contractors, and there’s no clear-cut system. And it’s not because they’re difficult. They’re wonderful. It’s just like, they haven’t thought that through. And so I was curious as to what your opinion was on that. Okay. And

Jackie Easterday
And a lot of times when it’s just people that are just starting out, they don’t have a system yet. And so I think even your guidance can kind of help them to develop something, but they’re maybe they’re not ready for, you know, a CRM or something like that for invoicing.

Dolly Delong
That’s awesome. Okay, so I have like, I’ve been taking notes, I have six points for you that repeat. But are there any other nuggets of wisdom you want to add to the system?

Jackie Easterday
Honestly, I think it is so important for business owners to know their numbers. And you don’t need to know every single detail. If you’re at a point in your career and your business is growing, where you can hire out your monthly work or your taxes or something to a professional who knows the nitty gritty and the details, it’s still important for you to understand the generalities and the big picture, I think that that is how you are I really believe that’s how business owners are distinguished you might not understand how taxes are calculated, but you understand that your business, you know, taxes are calculated in this way, or just the generalities are super important. And I know not everybody is a numbers person, I hear it all the time. I’m not a numbers person, I don’t care, I don’t know. But like you can be and you don’t have to be an accountant, you don’t have to be a financial analyst or anything like that. But you should know the overall numbers, you should have an idea of how much money your business is making and what you can pay yourself and prepare yourself for taxes and you absolutely can. So I think that is so important, is to get rid of that stigma that you’re not a numbers person or it’s not your forte, you can obviously outsource and hire out. But you still need to have an idea of what’s going on on the number side of your business.

Dolly Delong
And that’s just like, I just want to piggyback on that, like yes, even though you may not be a numbers person, like find somebody like Jackie, who is going to help help you navigate it and dumb it down for you. I don’t mean that phrase sounds negative, but that literally helps you understand all the intricacies of taxes that you owe or what quarterly taxes are and they won’t make you feel dumb, because this whole time honestly, before you Jackie, like the other person I was working with, kind of made me feel like an idiot. And I was like, Oh, I’m still gonna work with you. Because I don’t know. I don’t know who else to hire. And so I’m just so grateful that you did not make me feel like an idiot because honestly, there were some times I would text you or I would like to send you a Loom video, I’d be like, Jackie, I am an idiot. Like, you’re not in an idiot Dolly, you’re fine, you’re fine.

Jackie Easterday
We all have our zones of genius. And I think that’s a big thing is knowing where we’re strong and where we’re not and then filling in those gaps with outsourcing. But I do think there is such a stigma with accountants and CPAs and bookkeepers, similarly, with Attorneys, you know, and they aren’t all buttoned up straight, you know, intimidating. And that’s one of my biggest goals is to kind of break down that stigma and that fear of chatting with somebody about your numbers because that’s how you’re going to learn it’s somebody comfortable to talk with and we all deserve to know that and have that access. So I’m glad to hear that because that is one of my biggest goals.

Dolly Delong
You’re awesome. And also I love that you are your mom, and wife, you are very cute. Like you humanize yourself and also you all Jackie loves a good Margarita. So if you’d ever like to get to know her, and treat her to a good Margarita, I do have a question. I just literally thought of this. And okay, so you set aside, say a business owner decides, okay, I am going to set aside 30% every month from my profit, then at the end of the year, when I file my taxes, and then I find out I owe this amount, would you, I guess advise a person to do with the leftover amount that’s left in their tax account?

Jackie Easterday
So typically, you will have a leftover if income stays relatively normal. And you you know, unless your business spikes, you know, to the point that it really pushes you up a tax level or two. And so if you do have money leftover, what I usually recommend people do is, honestly transfer it to a business savings account, and pay yourself a bonus, you will when tax time comes unfortunately, on April, you know 18th this year, but typically the 15th, your bet your balance due. But then you also have your q1 payment for the first quarter is due. So some people will use that for q1 for their payment, and then whatever they’ve been saving throughout the year, you know, pay that to themselves. But honestly, I think to give yourself a bonus, save some in your business, pay yourself a bonus anything, because that’s your money. And that’s why I really advocate earmarking the money and putting it aside because it’s very out of sight out of mind. But it’s still your money. So in the end, we’ve worked hard for the money you’ve gotten through tax season. So if you get to that point, and you’ve got a couple of $1,000s leftover, if you want to put a little bit in your business savings and pay yourself a bonus, I would absolutely do it because that’s what you would be doing anyways, kind of using those funds to pay yourself.

Dolly Delong
Awesome. And okay, can I ask you another question? What is your opinion about when people say, well, this is a write-off?

Jackie Easterday
So I view write-offs or deductions, like when somebody says, oh, my gosh, I got this amazing deal on something, I saved so much money. And I’m like, would you have really? Did you really save money? Because would you have bought that if it wasn’t on sale? You know, that whole concept. And so some people just view it like it’s a business expense, a business expense, it’s going to reduce their income, reduce their tax liability, and they just kind of spend willy nilly. I 100% think that you should be deducting anything that is a business expense. But you should also do that in moderation. You know, don’t buy things that you wouldn’t feel are necessary anyways. Because then you just get into this habit of, you know, spending crazy like I hear a lot of times at the end of the year, people are like I’m trying to you know, I need to spend my money, I need to spend my money before year end so I can get a deduction. But for example, say you bought a $2,000 computer because it’s the end of the year and you’re trying to reduce your income. You didn’t save $2,000, you still spent $2,000 and your taxes on that are only about 30%, so you really saved yourself $600. Maybe that’s fantastic or beneficial. But just thinking about it in that sense do I really need this? Because it’s still money out the door. And honestly, taxes, no one loves them. But if you’re paying a lot in taxes, it’s because you’re killing your business. I think shifting your mindset, it’s very hard to do that way. But shifting your mindset to realize like, hey, my big tax bill is kind of a flex, I think will help to sort of get you spending appropriately.

Dolly Delong
Yeah, I love that so much. And that’s something that is so weird. In the last two years, my profit has been slowly increasing. So I love that you said it’s like a mindset shift and it is a flex. Hey, I’m making more money. Yeah, I’ll Oh, much more taxes, but I’m making more money. That’s awesome.

Jackie Easterday
Yeah. Then at the end of the day, we all have to pay taxes and we can complain about them all we want, but they’re not going anywhere. So shifting your mindset and also just it is what it is. Save for it, prepare for it, give yourself peace of mind, and focus on positivity. We could complain about taxes 12 months a year, but it’s not going to make anyone’s lives better, we still have to do it. So the best thing you can do is just to plan and prepare and set yourself up for success. I think that that is a huge way to kind of shift the mindset around taxes

Dolly Delong
Yeah, and then, of course, hire somebody like you to help with like the behind-the-scenes and setting up servers and like I’m not trying to embarrass you Jackie, but like really I’m like trying to like let people know that this is what Jackie does, and she will help you out with your taxes. She’ll help you up with quick she just like we’re about to do a QuickBooks setup for me because I’ve never used QuickBooks or I might have like five years ago and it was too overwhelming for me. So I’ve been manually tracking everything and so now I’m at the point where I need QuickBooks. Jackie even told me you need QuickBooks, she’s telling me.

Jackie Easterday
When you’re ready to grow in scale, setting yourself up for the foundations, and QuickBooks is it is intimidating in the same way that Dubsado is super intimidating to me. That’s why you hire somebody to set you up with like steps and tools and things to maintain the system that’s going to save you time and help scale your business. So it’s another you know, business investment that we make but long term when you’re growing and scaling. It’s not too soon to kind of jump into that and get things organized there.

Dolly Delong
I 100% agree with you. All right. So I want to know can you share with everyone your free gift that you have for everyone?

Jackie Easterday
Yeah, so you guys can all find me on Instagram. Right now, I have a find me on Instagram, download my service guide find all my information. But right now I’m actually offering a promo I offer 1-1 30 Minute Calls, pick my brain. Do you have questions about taxes? Oh, you know, anything, business bank account, saving for taxes, tracking your profit. Like all those questions. As I said, I really want to break down the stigma that accountants are intimidating and scary, and unapproachable. So I offer 1-1 30 Minute Calls. And I am actually offering in the middle of offering a promo right now. My birthday is on April 15, that’s Tax Day.

Dolly Delong
That is made for you. You were born to be a CPA.

Jackie Easterday
Yes, for the next couple of weeks, I’m offering a promo for my calls, it’s tax B-day is the call, you can find all the information on Instagram if you find me on Instagram to get a discount off on those calls. Because again, I know that so many people have questions. And honestly, this is it’s fun because it’s my birthday, the end of tax season and a little celebration, but I’m also hoping it just kind of gives people that nudge who have been like I have questions I want to ask to reach out and realize, you know, it doesn’t have to be terrifying or scary because sharing that side of our business is very vulnerable. So I hope this kind of gives those people who are on the fence a little nudge to kind of move forward.

Dolly Delong
Yeah, it is very vulnerable, but it’s also very encouraging to have somebody still walk alongside you in a very nonjudgmental way. So I love it and so can you share your Instagram handle with everyone because you have an amazing. You’re on Instagram and I love following you on Instagram.

Jackie Easterday
Yes, it’s @jackie.easterday.cpa,  send me a message, I love to chat with new small business owners and hear about just learning about I don’t know I think it’s super fascinating to see how people have structured different businesses and what they’re doing.

Dolly Delong
And Jackie is really good about voice texting, or at least she’s really good about voice texting,  I don’t know if she likes voice texting. I’m just like, right out there, I don’t know if you want to hear her voice. But Jackie, I just want to say thank you so much for coming on today. This episode is gonna help out a lot of creative business centers. I just know you’re right. Like it is important to just develop some sort of system with the finances of your creative business and to be proud of yourself. As you learn how to scale your business, yes, you’ll have to pay taxes but you’re growing so yeah, there’s no shame in that, so thank you so much.

Jackie Easterday
Thank you for having me. This was so much fun.

Dolly Delong
Of course, everyone. I hope you all have a wonderful rest of your April. Feel free to like DM me and DM Jackie and let us know how you are putting systems for your business in place for tax season so especially as you look to next year so until then, I hope you all have a wonderful week. Bye!

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