For the first time since running my business I got back a tax return. YAY! It was definitely a good feeling, albeit it was only a few hundred dollars. Still, it’s good to know that my company is paying and receiving taxes. For the first few years, I didn’t do taxes for my business. I ignorantly thought that since I didn’t make any money — and only lost money — that I didn’t need to do my taxes. Good thing I have an accountant now, eh.
Ok, so the purpose of this article is to coax my fellow young entrepreneurs — you — to reinvest your taxes back into your business. Even if you don’t have a business now, but got back some cash from your 9to5, you should use that money for your startup.
For the past few months I’ve been wanting to get serious with podcasting, so I invested my tax returns into some sweet podcasting equipment (mixer and mic) and a podcasting book.
You should do the same. Think about what you need for your business. Do you need a new design, some new books, or maybe a new computers? Well, be smart, and use your tax returns to either outright purchase those things or to offset the expense.
Running a successful business has a lot to do with cash flow and investing money back into the business. I know… I know… maybe you’ve been dying to get that 80GB video iPod, or a new phone…. but think twice if you know that there are more pressing investments that you need to make, investments that will add value to your business and create a better experience for your customers.
And it goes way beyond your tax returns; you should always be thinking about ways to get more money back into you business. As a startup, you can’t afford to squander your money on unnecessary things when you have a company to keep alive.
Sure, have fund and spend money on toys and things that you want — no doubt. But, just make sure that you are spending “more” on your business. Your business should be your number one investment — always.
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Another great post – and congrats! This post is one of our Young Entrepreneur links of the day!
Evan.
I agree with the concept of investing in the business. The upside potential is limitless. I saw that you bought a podcasting book. Which one? I’ve gotten away from buying books and have just been going to the library a bunch. The pickings are pretty thin on the podcasting front. I bet they take recommendations on what to buy though.
You make some really good points David, investing your tax returns can really come in handy for a small business owner.
I decided this year I would pay off any debt that I have with my tax returns, that way I can eliminate having to pay monthly payments on items that hold no value.
Also I’m glad to hear that you’ve invested in an Accountant, 11 months out of the year they seem pretty pointless, but boy do I love them around this time of year!!!:) Great Post Bro.