Sharon, how are you? I'm good. How are you, Jeremy? I'm good today. We've got a lot to talk about. Yes, I am not into this discussion, even though I need to be into this discussion. It is something important, especially as you embark on a 1099 career, to understand what, from a bookkeeping perspective, should you be doing. And today, we're just going to give some basics on what is bookkeeping, why is it important, what should you be doing, and hopefully keep it pretty high level. We're not trying to delve down and tell people exactly what to do with this, but we want to keep it high level so you understand the basics of it. Sharon, bookkeeping is basically just, you know, taking your financial transactions and putting them in such a way that they're organized. I mean, really, literally, that is it. You know, it looks at how much income you've got coming in versus expenses and deductions that you've got coming out. And it sounds really simplistic, right? But it's not as simplistic as it sounds. And that's one of the hard parts is you've got to understand some accounting terminology to do this. You know, it might be an expense that you paid this year for last year, and then you should have a receivable that butts up against that expense. But, you know, the bottom line is that you've got to be tracking what's coming in and what's going out in order for you to understand, one, how your business is doing, and two, what kind of taxes that you need to be paying or estimated taxes you need to be paying. So staying organized around this topic is extremely important. So another reason is there are legal obligations. You know, you have to meet tax obligations and legal obligations, and you've got to be able to, you remember back in school when they tell you to show your work, Sharon? Yes. Yeah. Well, that's what we've got to do with bookkeeping. You've got to be able to show how you got to where you are. When you submit that tax return, you know, the hope is nobody ever comes back and looks at it, right? But if they do, you've got to be able to document what you did, why you did it, and show that it was a legal transaction. It also leads into clarity. You know, it helps you understand, all right, yes, I'm making more money, but where am I spending money? Where are those expenses at? And what do I have as a business write-off for a tax deduction versus something that's a non-business deduction? So if you're an S-corp, for example, and you take out a distribution, is that a tax deductible expense? No, it's not. So the distribution needs to show up on the balance sheet and not on your profit and loss statement. So a lot of times making sure that you're coding these transactions correctly is a big deal. You know, and staying on top of what your expenses are or do you need to add some expenses on the things that you're missing? So many times I find with CRNAs that, you know, maybe they're charged something on their personal card and then it doesn't show up on the business side. So how do we get those back and reconcile our books? So basic terminology, you got income, right? We all know what that is. That's what you generate from being a CRNA and giving an anesthetic and waking somebody up, right? You got your costs, okay? Well, that could be equipment for work. Sharon, what do you use at work? You got a stethoscope, you got some scrubs, a scrub hat, a pair of Hoka tennis shoes. Do you wear Hoka? What do you wear? No, but I've heard they're awesome. I love them. They're amazing. But it could also be your home office. It could be your computer. It could be travel expenses for going to ANA meetings or North Carolina meetings or any type of C meetings that you might potentially go to. So tracking those expenses and deductions are the key. So, I mean, it's really simplistic. It's kind of like when I talk about financial planning, it's cashflow, baby. And cashflow is one of those four-letter words, right? Get it? Cash and flow. People hate cashflow. They hate when I say that because they know what's coming next. I say, do you T-R-A-C-K that cashflow? Oh, no, I don't do that. And what happens is the more money people make, the less that they track their cashflow. If I need something, I'll just pick up an extra shift. And, you know, it's doubly hard when you're working 1099 because one, most CRNAs don't like this stuff to begin with, right, Sharon? That is correct. Right. But you do need to be tracking it somewhere, somehow. So you need to have separate accounts for your business. I cannot reiterate this enough. So many times I see CRNAs utilizing their personal accounts or their personal credit cards to track their spending for their business. You don't need to be doing that. One, it's not clean. The IRS doesn't want to see you commingling a business and personal assets. That's a no-no, okay? Second thing is, it's easy for things to get lost. How do we discern that this is a personal expense versus a business expense? How do I know? How does the IRS know if they look at your records? They're not going to. But if you've got everything clearly delineated in business spending versus personal, then you've got a much cleaner situation. I told you, if I use an app, swipe left for business, right for personal, I save all my receipts. I'm right on them like you told me. I keep a pile and then I go back into the app. I take pictures of them. So they are in there. And then I do the envelope system. So I have January and all of those receipts, February. And so I have like a backup to the backup. So I have taught you well. That's exactly what I have. Yes, you have. You know, but tracking all those expenses, I mean, everything you just said, that is excellent. It's wonderful. Using digital tools, there's software out there such as QuickBooks that sounds like you're using. You've got Xero. There's a bunch of other applications that will do this for you. Kind of help you streamline this process. You know, so all those things are very, very important. So bookkeeping software, if you're going to use bookkeeping software, you need to understand it. If you're going to do it yourself, make sure that you understand how to use bookkeeping software. I will tell you that QuickBooks is probably the most popular business software out there to track this stuff, but it is not intuitive to use. No, it is not. I've had to call, but they have great customer service. I've had to call numerous times. What I do like about this is you can let your accountant in. So my accountant can get into my QuickBooks. Absolutely. And that's perfect. Most people don't need to be reconciling their transactions on a monthly basis. How do they know where to categorize something? You know, so I guess what I'm saying to you is if you're going to use software like this, make sure that you educate yourself on the right ways to categorize stuff, which, like I alluded to earlier, doesn't need to show up on the balance sheet, doesn't need to show up on the profit and loss. How are you tracking your basis in the business, especially if you're an escort? You can do that all through your software, but it isn't real intuitive to be able to do it. But there's a lot of softwares out there. Again, if you've got the time and want to educate yourself, do it. If not, get the software, have your accountant be able to log in as well. You can check up on them, look at your profit and loss and so forth throughout the year. That's great. Second thing I see people do is using a spreadsheet. Basically, they're just spreadsheeting what their expenses are, what their income is. And then on the far right column, they go in and they say, all right, this was an expense for clothing for the hospital. This was a home office expense for a new computer. They put it out there. So you can also use a spreadsheet, track those expenses, track your income. I see a lot of CRNAs who are 1099. They track their hours and then they match their hours up with what they get paid. So they match that up on a spreadsheet. And I think that's great. Making sure that you're getting getting paid properly. I had one today and she's making $300 an hour. She works, yeah, five tens a week. So she's making $15,000 a week. And it's pretty simplistic. She knows that every check should be $15,000. So pretty nice. Then the old pen and paper, you know, some people are still pen and paper people. And you can do that as well. You know, as long as you've got everything documented and that's what you've got to be able to show. Substantiate it. The IRS is not going to say it's not true just because you wrote it down, but you better have some substantiation behind it as well. So sometimes pen and paper works just as well for people who are old school. Staying organized. You know, I can't reiterate this enough. Establishing a routine to do your books. Once a month, once every two months. Three months, maybe. You know, I've known CRNAs to go six and eight months without reconciling their books. I try and do it every week. That's great. At least every two weeks. That's great. You know, on my calendar, I put it on my calendar as a task for once a month for me to go in there, double check all the transactions, make sure everything downloaded, categorize those transactions, and then do the reconciliation from the month before because reconciliations are always done, you know, after the month. So I reconcile for the month before and then the next month I reconcile for this month. So establishing a routine, whatever works for you. Again, if you've got an accountant or a CPA or a bookkeeper doing this for you, you know, it's always good for you to go in and make sure that they're doing what they're supposed to be doing as well. Just glance in, you know, a lot of you don't want to take the time to do that and I get it. But if nothing else, six months goes by, check your P&L, see how you're doing. Make sure that if you log in, you see the transactions that they're all categorized. Labeling and categorizing, again, we've talked about that probably ad nauseum in this presentation, but it is so, so important. Making sure that one, you're consistent with what you're doing. If you're vacillating back and forth your income from sales to services, I've seen that. People will say part of sales, part of services, well, what delineates that? You know, they're not keeping it consistent or, you know, they have auto and you'll have auto expenses and then gas expenses. And I'll say, well, what's an auto expenses? Well, it's gas. Why do we have two different, you know, delineations there? And then backing up, you know, if you're keeping it digital, you know, if you're running QuickBooks and so forth, they do a backup, you know, so you don't have to worry about that as much. If you're spreadsheeting, make sure that you keep a backup of that somewhere just in case, you know, it can be to the cloud, it can be to an external hard drive or both. You did find out the hard way. And if you're writing it down, keep a copy of it and throw it in a safe in case the place burns down or scan it in and keep it in digital world. But it's very, very important for you to keep that and keep up with it.

bookkeeping

1099 career

financial transactions

tax obligations

QuickBooks