Tag Archives: The Freedom Tour

How I managed to enjoy my audit.

How I managed to enjoy my audit.

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The other day my girlfriend asked me how my audit had gone. Two of our other girlfriends are apparently slogging through audits, so she was curious. Without even thinking about it I said, “Awesome!”

Really? My audit went awesome?

Besides the initial stomach flip-flop and a few annoying moments of having to become a tweezer-brain, I actually did, in fact, enjoy my audit.

How is it possible to enjoy an audit?

I was audited for 2011, which was the year I went on The Freedom Tour and fell in love with my husband Mike. It was a big year on a lot of levels. It was simultaneously one of the best years of my life and one of the hardest. So much growth in such a short period of time.

One of the key things the IRS wanted more details about was my mileage. In 2010 I lived in NYC and submitted no mileage. In 2011 I submitted about 30,000 miles. Big change. Red flag.

Luckily, I keep a really detailed calendar. (For better or for worse, I’ve done this since I was 14 when I got my first Daytimer.) I also pay for nearly everything with a debit or credit card because it’s easier to look up financial records that way. (Sorting through and entering cash receipts is hell to me. So I rarely pay in cash for anything business-related. It’s a choice I make so I have fewer things to do that are a pain in my ass.)

Retracing My Tracks

Between my detailed calendar and my detailed financial records, I recreated the map of exactly where I’d gone each and every day in 2011. I went month by month as I retraced my steps from one of the biggest years of my life.

I remembered certain lunches on the road with Mike at random truck stops. I remembered the weird motel with the bed that taco-ed and the world’s largest chili pepper sculpture in the parking lot. I remembered the night we ate popcorn, apples and peanut butter for dinner in bed.

It turns out that getting audited is a great way to remember a year. Combining my calendar with my expenses helped me recall moments I never would have thought of again.

Sometimes the magic is in the minutiae. (Tweet it!)

The whole process was actually a really sweet walk down memory lane.

So, what if you get audited?

  1. Keep good records:

Though I’m not a CPA, I can certainly recommend keeping a detailed calendar of your business engagements and detailed financial records of all of your business expenditures. The IRS wants to know the who, what, where, when, and how much for every expense. If you’ve got that in your calendar, that’s fine. I always write it on the back of every receipt, too, though, just in case.

I personally have a bookkeeper to help me keep this all organized because sitting with little pieces of paper and doing data entry is not in my zone of genius. It’s one of the things I began outsourcing early on, even when I was still in debt. I knew the time, energy, and irritation I saved myself by getting bookkeeping help would pay off big time.

Having squeaky clean records and being able to deliver proof of my mileage expenses to the IRS was one of the key reasons my audit was so pleasurable.

  1. Enjoy reminiscing:

It’s not often that we get out our tweezers and go through a year appointment by appointment, mile by mile, and dollar for dollar.

Decide to enjoy the process.

Our finances are maps of our lives. (Tweet it!)

If you really want to know about your life, look at your money. Sometimes this is sobering. Sometimes this is pleasurable. Either way, you’ll get some great information.

Of course, I would never wish an audit on anyone. Should you find yourself in the same situation as me, however, resist the temptation to assume it’s going to be awful.

Instead, pause and use it as a time to reflect upon a year gone by and enjoy remembering all the sweet moments (deductible or not) that make up your sweet life.

OVER TO YOU:

Have you ever been audited? What was it like for you? Do you have any good record-keeping tips for our community and me? I’d love to hear from you so leave a comment below!

kate_northrup_bschool_webinarP.S. Have you signed up for the free class I’m teaching next week, The Anatomy of Making Money Online 2.0: 7 Simple, Doable Strategies for Making a Profit and a Difference? I only teach this once a year so join me!

 

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P.P.S. Today Marie Forleo released the third of her 3-part free training video series about rocking an online business. Today’s video takes you behind the scenes of her multi-7-figure empire and answers your most burning questions about building a business online. Make sure you grab the video series while it’s still up!

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