Frequently Asked Questions

The IRS recommends keeping most business records for at least 3 years from the date you filed the return, as that's the standard audit window. However, 7 years is the safer standard and what most accountants recommend — particularly for records related to assets, property, or if you've ever had a net operating loss. Records to keep: all income records (invoices, receipts, bank statements), all expense records (receipts, bills, credit card statements), payroll records, tax returns, contracts, and asset purchase/sale records. Digital is fine. You don't need paper — scanned copies or photos of receipts are generally accepted. A simple dedicated Google Drive folder works well for receipt management. Note: This is general guidance, not tax advice. Your CPA or tax professional can advise on your specific situation and any New York State-specific requirements.

Yes. Absolutely. Non-negotiable. This is the single most common mistake we see in small business bookkeeping — and it causes more problems than almost anything else. Mixing personal and business finances makes bookkeeping dramatically harder, creates tax filing headaches, can cost you legitimate deductions, and — if you operate as an LLC — can actually expose you to personal liability by piercing the corporate veil. The fix is simple: open a dedicated business checking account and a business credit card. Use them exclusively for business transactions. This one step alone will cut your bookkeeping time in half and make your tax return significantly cleaner. If you're already mixing: Start separating today. The sooner the better. We can help untangle what's already there.

It depends on the bookkeeper - but for most tax work, the answer is no, and here's the important distinction. A bookkeeper is not a licensed tax preparer. Preparing and filing business or personal income tax returns requires a credentialed tax professional — either a CPA (Certified Public Accountant), an Enrolled Agent (EA), or a licensed tax preparer registered with the IRS. These professionals carry legal responsibility for the returns they file and are authorized to represent you if you're ever audited. That said, there are certain tax-related tasks that fall squarely within a bookkeeper's scope: 1099 preparation - tracking contractor payments throughout the year and preparing 1099-NEC forms at year end Quarterly sales tax filings - calculating and filing New York State sales tax returns on your behalf Payroll tax recordkeeping - maintaining the records your payroll provider or CPA needs Tax-ready financials - delivering clean, organized books so your tax preparer can file accurately and efficiently without spending billable hours cleaning up your records first Some bookkeepers hold additional credentials and can do both - but that's not the norm, and you should always verify credentials before assuming. At Opal Operations, our focus is keeping your books clean, current, and tax-ready all year long. For year-end business and personal tax preparation, we work with a network of trusted local tax professionals we're happy to refer you to - so your whole financial team is working together.