You can structure your business as a: 

• Sole proprietorship
• Partnership
• Limited liability company (LLC)
• Corporation (C Corp or S Corp)

All businesses are required to open a separate business bank account. But that doesn’t mean you shouldn’t do it regardless.

Your financial records are crucial for tracking deductions, projecting cash flow and more. According to the IRS, there are two financial statements you should keep a record of:

• Balance sheet, which consists of your business’s income and expenses.
• Income statement, which consists of assets, liabilities and equities in business.

You’ve reached your break-even point when your sales cover your expenses. To calculate it, use these steps:

• Step 1: Factor unit price (price per unit) minus variable costs (costs dependent on sales volume).
• Step 2: Divide fixed costs (costs independent of sales volume) by the amount found in step 1.
• Step 3: Result is your break-even point (in units sold).

One of the first decisions you need to make when setting up your books is deciding how to record transactions. You can:

• Record transactions by hand
• Hire an accountant
• Use accounting software

When tax season arrives, you’ll want to be as prepared as possible. To make this easier, throughout the year, you should keep running tabs on business expenses you might claim on your tax return.

You should also keep all of your financial statements up to date to make filing taxes easier. Your business’s finances are crucial to its success, and as a business owner, it is up to you to educate yourself on the accounting process.