If you are like me then you don’t like figuring out your taxes each year. It’s probably too late for most everyone (unless you didn’t profit in 2006) but here are some of the things that I’ve started doing to help make my life easier at tax time.

First, depending on the type of business you run you should definitely invest $100 or so and pick up the latest version of Quicken. Even if you don’t plan on e-filing, it’s really a great program just for book keeping and transaction recording. If you are smart with how you set it up and track everything you can also use this to balance multiple bank accounts.

Depending on the bank you bank with you can also set up your bank account to automatically communicate with your Quicken configuration in order to download transaction and balance data. One thing to make sure you always do is back up your Quicken files though. By default the configuration file that includes all of your data is stored on your C:// drive. If you have any hard drive trouble you could lose all of your tax related data, which would be a nightmare. This has happened to me and I can personally vouch for it being a major pain.

If you have employees and need to track paychecks, insurance, etc, then I suggest checking out QuickBooks. It’s more advanced and is more expensive than Quicken, but if you are keeping track of payroll and have a lot more money being moved around it will be a better alternative for you.

There are of course other similar programs that I’m sure are fine as well. I’ve never used anything but Quicken personally, so that’s all I can recommend based on my own use and experience. It’s definitely worth the money. If you are only using it for book keeping then you probably don’t need to upgrade year after year either. I’m still running Quicken 2006 mainly for income vs. expense tracking. My accountant takes care of the rest when it comes time to send my regards to Uncle Sam.