Expensify Blog

Guest post By Mark Cummins, CPA

With two weeks until the April 15th tax deadline, will you be ready to file taxes on time and without any issues? If you’ve found yourself scrambling to do your taxes this year, making yourself and your tax professional crazy in the process, here is a top ten list of suggestions to make taxes next year a smoother process. By starting on a solid tax strategy now, you will be rewarded with less headaches and bigger deductions next year.

1. Use your credit or debit card for all business expenses – The IRS allows copies of credit or debit card statements for itemized proof of business expenses. Link the card with your Expensify account and get eReceipts for most expenses under $75, then capture receipts for big ticket items with their mobile app. It’s still good, however, to keep the receipts for very large purchases so file them away after you snap a picture.
2. Use one bank account for business – Open up a business checking account and run all of your expenses through it. Try to find a bank that has online banking, allows you to download transaction history in OFX or QFX format, and stores 7 years of statements, including check images.
3. File receipts immediately – A lot of deductions are lost due to missing receipts and documentation for the expense. Install any of Expensify’s mobile apps to take pictures of receipts as you get them. If you have a smart phone that is yet to be supported, simply snap a picture of the receipt and either email it or upload it to your account at first chance.
4. Organize your records – Make sure to group all of your expenses and their receipts in to categories like meals and entertainment, office supplies, travel, etc. If you’re not using Expensify to organize your expenses, keeping receipts sorted and categorized in manilla folders is the next best thing. Keeping your tax records in one place will save hours of frantic searching at tax time (and help you if the IRS comes knocking). Remember, when it comes to taxes, being organized is your friend!
5. Log your miles – If you use either the standard mileage deduction or actual costs for vehicle expenses, log your business miles as they happen. Enter in the stops on your trip and Expensify will calculate the mileage expense for you or pick up a calendar or mileage log at your local stationary store and write them in manually. Whichever way you track mileage, make sure it’s easy to add up and compute at years end.
6. Do monthly profit and loss statements – Often small business owners fail to “keep the books” on a regular basis. With all the bookkeeping software available there is no reason for you, or a hired bookkeeper, not to keep your books on a regular basis. QuickBooks is free to try and a good place to start. If you found a bank where you can download data, often you can organize and then upload your transaction history straight into your bookkeeping software.
7. Use a payroll service – Most payroll services offer special rates for small business owners, often at less than $50 per month. They will deduct all of the necessary federal and state taxes and then direct deposit your “net paycheck” into your personal account.
8. Perform a mid-year tax check up – Small business owners often fail to make proper estimated payments during the year, and then come up short on Tax Day. Contact your tax professional and estimate what your net income will be at year end based on how you are doing mid-year. Teaspiller provides online tax prep help. Teaspiller allows you to import all of your data from Expensify, and other popular small business tools, so you can have an accountant review everything without ever having to step foot inside their office. They’ll calculate your estimated tax liability and give you an idea of how much your quarterly estimated payments should be.
9. Keep a “Perm File” – Have a file box with your most important papers like homeowner’s policies, auto purchase agreements, loan documents, and business agreements, in one place. You may never need this come next April 15, but you’ll be glad you have it organized if you do.
10. Make a note of itemized deductions and credits – There are many standard deductions you can claim, which reduces the total income that can be taxed. Standard deductions may include child care costs, education costs, interest on your mortgage, charitable donations, and more. Find out which deductions you are eligible to claim and keep track of them in a separate expense report which you can hand to your tax professional.

Mark Cummins, CPA has over 20 years of experience in tax, accounting, and systems areas. He has extensive experience with the IRS Tax Court and manages a private CPA practice in Los Angeles, California. He’s also an expert available for help on Teaspiller, an online tax platform that allows small business owners to get help from tax experts around the country without ever leaving their office or home. Visit his profile at: http://www.teaspiller.com/mcummins.

Click here for more tips and information on how Expensify and Teaspiller can help you come tax time next year.

If you missed the live stream on the 19th, check out David Barrett talk shop live on TWiT with Leo Laporte and Amber MacArthur.  Watch both parts of the segment below.

Part 1

Part 2

Leo Laporte and the net@night crew took the time to talk with David Barrett about painful stories of expense reporting and how Expensify eases those pains, partly by eliminating the need for paper receipts with a full offering of mobile expense tracking apps to capture receipt images on the go. Single sign on leads the conversation to the recent integration with the Google Apps Marketplace and ends on a high note discussing Leo’s last expense report.

Check out more videos about Expensify on our YouTube channel: http://www.youtube.com/user/expensify

It’s been an exciting past few weeks for us at Expensify and, now, March 10th officially marked the first year of Expensify being live and available to a mass audience. What better way to celebrate than throw a Mile High Party in the 19th floor penthouse of the building we work in?

DJ Asbestos spins at the Expensify Mile High Party

We were honored with the presence of our amazing users, Greg from Cannonball winery, and Jamie from Ty Ku were nice enough to donate several cases of wine and spirits, our investors came out to share in the cheer and many more wonderful friends helped to make the evening a success.

Take a look at our major milestones since March of 2009:
– Raised $1M of funding with investments from Hillsven Capital, Baseline Ventures, and Travis Kalanick
– Tripled in size with the addition of 4 new hires to continue development, improve layout, spread the word and keep expense reports suck free.
– Launched out of Beta and in to our 1.0 offering.
– Integrated with Outright, Salesforce and Intuit.
– Launched in the Google Apps Marketplace

There are many more stepping stones that got us where we are, but we won’t bore you with the details. And if you missed the party, no worries, there’s always next year.

A big thanks to every one of our users and supporters that made the first year possible!

If you are a small business, or if you sell to small businesses, the Google Apps Marketplace is a Big Deal. Taking those in turn:

If you aren’t already using Google Apps to host your small business infrastructure, you probably should. It’s free for most, and inexpensive for the rest. But it’s incredibly convenient for all due to single signin, central administration, and a generally consistent experience across the board. That convenience for you (and your employees) translates into higher productivity, meaning more hours out selling/building/working, and fewer hours of confusion and employee angst. That story has been true for some time. But with this latest announcement, it’s even more true because now third-party applications can seamlessly integrate with Google Apps to provide a seamless experience between not just Google applications, but all applications.

This is where the other side of the coin comes in: if you sell applications to small businesses, the Google Apps Marketplace is a really big deal. There are a lot of small businesses out there. In the US alone, there are over 25 million. That’s a huge market. But it’s a hugely fragmented market. Getting the word out is an enormous challenge, and marketplaces like Intuit Workplace, Salesforce.com, and — now — Google App Marketplace are crucial to pulling it off.

See, to succeed in selling to small businesses, you need an incredibly low cost of sale that scales to incredibly high volumes. You can’t have a bunch of sales people out chasing a $10/mo customer. Rather, you need those $10/mo customers to sign up 24 hours a day, day after a day, to add up to a reliable revenue stream. That means they need to find you. And contrary to expectation, they’re probably not looking for you in a search engine. Rather, they’re looking for you in a marketplace: on their phone, inside QuickBooks, or inside Google Apps.

With all that said, let me happily announce our own latest integration: Expensify in the Google Apps Marketplace!

Expensify is integrated with the Google Apps Marketplace

We’re huge fans of application marketplaces: we’re the “Most Viewed” application in Intuit Workplace, a Salesforce.com “Force 40” application, and have high-rated apps in the iPhone, Android, BlackBerry, and (surprisingly popular) Palm Pre stores. Each of these marketplaces has been a powerful gateway into a new demographic: Intuit for accountants, Salesforce for salesfolk, mobile for the modern man. Each of these groups is huge, but hugely fragmented. These marketplaces provide a powerful, cost-effective way to get the word out on a massive scale.

Accordingly, we’re very exited for this latest integration with the Google Apps Marketplace as it puts us a click away from IT managers at millions of small- to medium-sized businesses worldwide. And that’s not a metaphor: literally we’re one click away (ok, two if you’re being picky) when Expensify is installed in your universal navigation bar.

Add the Expensify app to your Google Apps. Find us under the More -> Expenses tab

Once the Expensify app is integrated with your Google Apps domain, you’ll gain access to our full expense report management powers right from the universal navigation bar.  Click on more to expand the tab and select Expenses to access Expensify from within Google Apps. This means everyone in your organization — from the lowest temp to the highest executive, whether you have 1 or 1000 employees — can put down the glue sticks and paperclips and start doing expense reports that don’t suck.

To learn more, please check out our short list of 1-minute tutorials to get acquainted with the features that are going to ease your expense reporting pains.

We’ve had several people asking us whether scanned, photographed or otherwise electronic receipts are legal and accepted by the IRS for tax purposes. We did some digging and found the answer to share with everyone.

The short answer is YES, electronic receipts are legal and accepted by the IRS for tax and audit purposes as long as they can be accessed reliably, in case of an audit, and are legible (irs.gov). A short list of acceptable electronic documents are scanned or photographed images of original receipts, credit card receipts, and credit card statements that show the amount, date of payment, and the vendor or merchant.

I'm valid!

If you’re into legalese, the two articles dealing directly with the legality of electronic receipts for tax purposes are IRS Publication 552 and even more information about electronic receipts can be found starting on page 9 of IRS Revenue Procedure 97-22 (PDF).

Please note that we can not give out tax advice, so check with your tax agent or attorney.

We just launched out of Beta and in to 1.0!