Record Keeping

You are an independent consultant, which means you are not an employee of Gold Canyon's. If Gold Canyon pays you more than $600 a year in commission checks/direct deposits, you will receive a 1099 from them. Regardless of whether you receive a 1099 or not, you are responsible for claiming your income on your taxes. This can get confusing for some, so please take my advice in keeping the following records:

Separate Checking Account  Keeping your business finances separate from your household finances will help you to keep track of what you actually make in profit. Only take money for yourself when you pay yourself with a paycheck so you will have a record of it. Deposit all money from your sales into your account. At the end of the year, the total of all your customer receipts for the year should match the total of all the deposits you made into your account. Because I run my business this way, I am able to just add up my deposits for the year to determine the total sales that I had for the year.

Customer Receipts  Keep at least the white (top) copy of each customer receipt. I file these by year, so at the end of the year, you should have a stack of these receipts that are proof of your sales for the year.

Purchase Receipts  Whenever you make a business purchase, you should keep the receipt to claim as a business expense on your taxes. This includes things like: purchases from Gold Canyon, business supplies, food purchased to make refreshments for a Gold Canyon Open House/Party, conference fees, etc. I suggest you also make a notation of what the expense was for since not all expenses are 100% deductible on your taxes.

Mileage  Get into a good habit NOW of keeping track of the mileage on your vehicle whenever you do business activities. Keep a small notebook in your car to record the distance traveled, the date, and what you were doing. Mileage adds up during the year & can become a huge deduction for you if you keep proper documentation. You will also want to note the mileage on your car at both the beginning and end of the year so you know the total number of miles the car traveled during the year.

Product for Yourself  Oftentimes, you may add a few items onto an order for your customers that you are buying for yourself. Keep a list of all items you keep for yourself during the year to report them on your taxes.

Inventory  If you keep any inventory in stock (products you have purchased but have not sold to customers), this must be recorded at the beginning & end of each year. What you'll need to do is have a list of what items you have in stock & how much they cost you (catalog price minus commission earned on the items). These are important details to have for your taxes.

Samples  If you use tealights for samples or give away auto fresheners, any products that you give away during the year as part of doing business, you will need to keep a list of these items. They will help you make an accounting for all the products that you purchased during the year.