As an experienced accounting professional, you know that having your documentation in order is key to nailing your tax filing. Messy records can lead to missed deductions, compliance headaches, and SO many unnecessary stresses. Luckily, we’ve got some tips on how to streamline your tax documentation process and how AI-powered bookkeeping automation can lend a hand every step of the way.
1. The Tax Document Checklist
First things first, it’s time to create a checklist of all the documents you’ll need to organize and store. Make sure to include everything from income statements and expense receipts to bank statements and payroll records. Don’t forget supporting documentation or additional handwritten notes with receipts that include things such as meeting dates, purpose, and guests or customer names. Having a thorough checklist ensures you won’t overlook any critical documents.
The AI-Powered Solution: Automated Document Capture
With Docyt’s AI-powered software, capturing the easy-to-forget but important data to store and remember is genuinely easy. This software features OCR technology that scans and digitizes documentation like receipts and invoices and then sorts and stores the information accordingly. There is no more wasted scrambling to find documentation or specific information for your taxes at year-end. Docyt keeps everything organized and readily accessible, saving you valuable time while reducing the risk of missing information required by the IRS or, worse yet…errors.
2. Digitize Your Documents and Financial Records
Second, it’s time to go digital with ALL your accounting records. Keeping digital copies of your allows you to stay organized, retrieve documents quickly, and save a significant amount of space. You can easily take photos or scan and upload documents to a cloud storage. A best practice is maintaining an Excel sheet to list, categorize, and label transactions corresponding to the documents you digitized and electronically stored.
Pro tip: Add comments to the spreadsheet, embed links that take you directly to the corresponding files, or attach files directly to individual line items.
The AI-Powered Solution: Seamless Integration and Storage
Docyt supports various file types and smoothly integrates with many existing systems for easy document storage that can be easily compiled in one place via automation. Systems integrations include ERP, POS, merchant processing systems, financial institutions, payroll software, etc. Having the ability to automate the collection of documents from multiple systems, PLUS condense and store documents in a singular space, not only simplifies document storage but also saves time and increases accuracy.
3. Organize and Label EVERYTHING!
Third, learning to categorize and label documents accurately and having the discipline to do so daily will make your life easier for both month and year-end. You will be grateful every time you need to be able to access and retrieve documents quickly. The right way to approach this is by properly labeling and categorizing your documents and files. Here’s a pro tip – ensure each file is clearly labeled with ALL relevant details included. There are many ways to sort and label your docs; for example, you can divide docs by vendors, income, expenses, payroll, etc.
The AI-Powered Solution: Automated Categorization
Docyt uses artificial intelligence to automatically categorize, label, and match documents. Docyt AI ensures that all your documentation ends up in the right place. Another notable thought is that all AI systems learn from user interactions and regular feedback, which improves system accuracy and performance over time.
4. Compliance Checks
Fourth, it is paramount that you proactively check for compliance and accuracy when reviewing your documentation against IRS regulations and tax laws. Things to verify are that amounts and transactions match, are properly categorized, have complete and detailed supporting documents, and have added notes where required. Most vital is to ensure that all your documentation and your accounting practices adhere to current tax laws.
The AI-Powered Solution: 360-Degree End-to-End Automation
Manual bookkeeping and accounting practices leave room for non-compliance issues and errors to surface. Leveraging AI-powered automation tools, like Docyt360, significantly reduces your risk of errors, thus nearly eliminating any concerns that you will be in non-compliance.
5. Update Records Frequently
Fifth, do whatever it takes to ensure your records are kept current. It’s wise to update them weekly, if not daily, to avoid catch-up bookkeeping needs. Regularly updating and reviewing your financial records and scheduling periodic reviews will make a world of difference as you enter tax season.
The AI-Powered Solution: Continuous Monitoring
Docyt offers continuous monitoring and real-time updates of your financial data. Hands down, you can count on Docyt to catch errors, identify patterns, and catch anomalies while providing on-demand access to accurate and current data 24/7. Fully automated real-time accounting solutions like Docyt make the end-of-year tax filing process feel like a walk in the park.
Let Docyt Make Tax Filing Effortless
Organizing your tax documentation can be manageable. With a systematic approach and the right tools, you can easily ensure accuracy, compliance, and efficiency. Docyt’s comprehensive features, from automated document capture to real-time data, are here to support and simplify tax preparations.
Are you ready to revolutionize your documentation processes and accounting workflow? Contact Docyt today and discover an all-new year-end experience.
