Repost - Closing Down Your Business for 2011

                                             Dala Horse sold $24.95

Below is a repost from last year about how to close down your business for the year. I had a reader ask me about taxes and whether I do them. It's a great question because there are a lot of ReSellers that don't. My mother used to be a bookkeeper though so not doing taxes would leave me with all kind of guilt both from my mother and from dodging the government. This year, if you make a certain amount of money in sales, Amazon, Alibris and Paypal will have sent you an email asking for your social security number because the government is requiring them to do so. It will be a lot harder to avoid paying taxes. Taxes give me an excuse to really understand my business. I get to learn how much I spent and even better yet, how much I made. Although I don't like crunching numbers, I love the final moment when all is revealed.

Here is the 2010 post with a few changes.

Are you ready to close down your business for the year? Here's what I do in preparation for taxes:

• create a new 2012 Excel Spreadsheet for all my selling venues that include books, eBay, Etsy and misc sales. I usually make a copy the current spreadsheet and then delete all the sales and item details. I'll name the file ReSelling 2012.
• Count all inventory in house and garage. Some of this data is on my computer and some needs to be counted manually. Many items I will have stuck a small post-it note with the details of where I bought it, how much I paid and the date.
• Print off all eBay invoices for the year. Click on My eBay, Click on My Account, Click on Select Invoice (right hand side). I print off January 2011-December 2011. Organized sellers might do this every month but I tend to wait until the end of the year.
• Print off Etsy Bills for the year. Click on Your Etsy, Click on Your Etsy Bill. Click on each Month to see your bill.  You can also download files but I prefer to print off directly from Etsy.
• Print off Paypal 2011 Financial Summary. Click on Report under the History Tab. Click on 2011 Financial Summary. 
• Place all Thrift Store Receipts in Business Purchases manila envelope. Place Business Expense Receipts in Manila Envelope. Place all Mileage information in Manila Envelope. Place all Travel Expense Receipts in Manila Envelope.

As a disclaimer, this above is how I handle my business end of year. I'm not a qualified financial adviser or accountant and the best advice I can give is to contact someone qualified for detailed information on how to close our your business for the year. Since I made more money than previous years and because I don't like bookkeeping like my mother, I'm considering hiring a bookkeeper for my business. The ReSelling business can be very complicated since it is often spread out over many venues.

Here is a fabulous post from A La Modern on ReSelling & Taxes.

Because January is such a good month for ReSelling, I don't normally tally up my sales and do tax preparation until February when sales slow down. February has always been my month to catch up on paperwork. I'm really looking forward to figuring out how much I sold in 2011 with my record months in November and December. Have you been adding up your ReSelling sales? I'm hoping to sell even more in 2012 and look forward to getting started next week. I have much bigger goals in 2012 and working efficiently and in an organized fashion is the first step for me.

I'll be back on Monday, January 2nd with Thrift Share Monday. There are luckily a few sales tomorrow morning. Thankfully because I'm not sure how much more of this dry spell that I can handle.

Happy New Year everyone!

Comments

[Joy P]

Good suggestions. Also read the suggested link. I have been working on tax paperwork during December and its takes hours, has to be accurate, backed up with memos and receipts (proof), details. Its interesting that the data needed is very similar between Canada and USA.

[Van]

I love this post and will be referencing it often as I work on reporting my taxes. And I'll be buying your spreadsheet and encouraging other beginners to do the same :)

Happy New Year Selena, I hope you, your family, and career have been doing very well.

[Eva]

I just want you to know that I adore this blog and check it every day. I wish you the best of luck in the new year!

[Linda]

Great suggestions Selena. I'm starting to save my thrift store receipts but what about estate/garage sales? Do you ask for receipts from them? Thanks, Linda

[Selena Cate]

Regarding Garage Sale receipts, I dont ever ask for them. I do get them from estate sales. From garage sales I typically write the price down on a tiny post-it note with a handwritten price on the item. Ill also enter the date into my excel spreadsheet. Overall I dont think the IRS can be too picky. Some of the items that I buy for a dollar I sell for $100.00. I think keeping good records is the best thing that you can do.
warmly,
Selena

[Ava Venson]

I'm pretty sure you can handle it, girl! As of now, I don't have plans of closing down my business. But when I do, I'll have everything prepared so I won't have to deal with problems in the future. =)