About this time last year, I was scrambling to collate and record my business expenses so I could turn them over to my tax preparer and get everything filed with the IRS. I realized very quickly that I had been keeping horrible records, and although I knew to keep my receipts, I wasn't diligent about cleanly tracking the totals or categorizing them properly.
This year, I did my own taxes, and had to go through the process all over again, adding up receipt totals and figuring out which category they belonged in on the Schedule C for my business. I use Mint to track my accounts, but with the combination of work and business accounts, it wasn't that easy to separate things out.
So, I decided to do things right this year. I'm no spreadsheet wizard, but I knew I could figure out an easy way to keep all my expenses tidy. I've learned in the last year that my favorite cell equations are the conditional ones, specifically SUMIF, and I have to say it certainly came in handy putting this expense tracker together. Sorry, I think my nerd was showing there for a minute.
I went over the Schedule C form and pulled out the categories that I had values in on my tax return, as well as all of those that I anticipated spending against in the coming year, then assigned them each a number, 1 through 14. Lastly, it was just a matter of creating a basic ledger, then linking up the totals with equations that would auto-calculate based on what category each expense was assigned.
At the end of the year, I anticipate consulting my spreadsheet, transferring the numbers to my Schedule C, and not looking at a single receipt in the process, but knowing that I have them on file just in case I need to reference them later. How cool is that?
Like I said, no spreadsheet wizardry here, just some common sense, a few conditional equations, and some simple math. The result is a worksheet that I can revisit every single time I have a business-related expense, enter the record, then file the receipt away. Or, in the case of online billing, I'm saving my electronic receipts into a folder next to the spreadsheet as PDFs with a simple naming convention: yyyy-mm-dd-vendor-description. That way the files auto-sort by date without any fuss (and there's a column to tick whether the receipt is in paper or electronic form for future reference).
Honestly, I'm pretty proud of myself, and I already feel like I'm on top of my tax-related expense tracking for this year. I'm so proud, even, that I'm offering the spreadsheet here for you to download and use as you like. My spreadsheet fiddling ends up being your benefit!
Updated and improved for 2013! Now includes complete list of Schedule C categories based on 2012 form. Download Expense Tracking Worksheet (.zip file with a Numbers file for Mac and a .xls file for Excel). You are free to use, distribute, modify, and bastardize the files at will!
Do you have a simple or complex way of tracking your expenses? What works for you?
Toolbox is a series of articles about productivity and business tools that I use to get things done. Each article spotlights a single tool—whether an office supply, a computer app, or a work process—how it's useful to me, and how it might be useful to you. And each article is offered up of my own accord. No sponsorships, no affiliations, no commissions.