Updated: Apr 18, 2022
It is TRUE! You do bookkeeping to get ready for taxes, but some of your expenses are only recorded on bookkeeping and some are only reported on taxes. Most are counted on both but there is some differences!
What are the differences?
One of the biggest differences that affect all businesses: Meals and Entertainment. For 2020, there is no difference. It is a 100% write off as long as your meals are at restaurants. However, usually, it is only a 50% write off on taxes.
Do you work for home? Bookkeeping doesn't account for use of home office utilities and square footage. However, It does include corporate rent if your an S corporation.
Drive for your business? Mileage isn't included in bookkeeping but is a deduction on taxes.
Want a visual? Download this month's free Bookkeeping and Taxes are different printable!