Answers · Bookkeeping
Monthly Bookkeeping Services: What Is Included?
Bookkeeping should reflect the transaction’s economic substance and be supported by reconciliations and source records.
How it works
The rule, and what it turns on.
Identify whether the transaction creates income, expense, an asset, liability or equity change; then separately determine tax treatment.
Example
A $1,000 payment may be expense, loan principal or asset cost depending on what it bought.
Common mistakes
What we see go wrong, and what we do instead.
- Relying on bank-feed labels.
- Mixing personal/business activity.
A better approach
- Use an uncategorized clearing account temporarily, then resolve before close.
Authority
Where this comes from, so you can check it.
IRC §6001; Treas. Reg. §1.6001-1; IRS Publication 583; IRS Small Business Recordkeeping guidance.
Educational information, not individualized tax advice. Treatment depends on your facts, entity classification and tax year, and IRS instructions change. Confirm your own position with us before relying on it. Mint Associates does not provide legal services.
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