Tax season? Didn’t that just end?
Your thoughts may be more on spreading mustard on a BBQ frank at the beach rather than sweating over spreadsheets.
Alternatively, you might be rushing to get those new projects underway before the first frost.
Why should you be thinking NOW about tax season? We are just about halfway through the year and we’re way past the April federal tax filing date.
We’re not writing this to stress you out. We just know that taking some specific steps now can save you lots of stress in 2023. And these steps are pretty simple, so you can get back to that picnic or project in no time.
Your Construction Company Needs to Carefully Watch These Line Items
Tracking expenses is critical for managing your construction company. It helps ensure that your projects are more profitable and that you have healthy cash flow each month.
When you spot variances or cost overruns you can take immediate action, but keeping on top of individual categories of expense can help you tremendously when tax season rolls around. Plus, if you have the right system in place, you don’t have to sift through spreadsheets, expense reports, and even paper receipts.
The various categories of expenses that can help construction companies with tax planning and potentially reducing tax exposure are:
- Electronics (like computers and tablets)
- Labor costs
- Phone expenses
- Professional education and training
- Trade school tuition
- Fees paid to attorneys
- Union dues and other memberships
- Advertising and marketing: Conventional and Online
- Machinery and large tools
- Construction supplies and small tools
- Meals and entertainment
- Vehicle payments and maintenance
- Car and truck insurance and registration
- Vehicle depreciation
- Home office expenses
- Travel expenses for out-of-town projects
Why wait until the end of the month (or when you’re preparing for taxes) to get your arms around how much you’re spending in each category?
Plus, if you have the right system in place long before taxes are due, you can spot any trouble areas and take action to reduce or eliminate unnecessary expenses.
The Best Way to Keep On Top of Each Line Item (Long Before Tax Season)
Although we originally built and launched Vendrix as a way for construction companies to stay on top of spending and reduce staff hours needed to track and report on expenses, we discovered another huge benefit.
The reporting you can get from our system enables you to be tax-ready 365 days a year.
When you use the Vendrix system, you not only save the equivalent of one week each month on expense tracking and management, but you also see -- at a high-level and micro-level -- exactly where every dollar your company spends is going.
Our corporate cards are built specifically for construction companies and builders, so we understand what you buy, when you buy it, and what types of information you might need in the future for tax calculations.
- set permissions on spending levels and even what types of services and materials each person at your company is permitted to buy.
- make smarter decisions by estimating project expenses more accurately,
- empower your team to move quickly on jobs, and help you better manage cash flow.
Plus, that level of data gives your accountant and other financial managers exactly what they need, wherever they are and whenever they need it.
Your accountant will love you for it. Not just next April, but all year long.
Now you can get back to that beach vacation, next major construction job, or anything else you need to do this summer.
But before you do, book a demo to learn how you can start preparing for next tax season.