Who this applies to
Owners who keep their own books.
Key questions
- Are deposits being recorded as revenue?
- Are owner draws and loan principal kept out of expenses?
- Do you have W-9s for every contractor?
Review with the OICPA team
- Separate business and personal accounts
- Reconcile monthly
- Track contractor payments all year
On this page
- 1. Mixing personal and business money
- 2. Not reconciling
- 3. Recording deposits as revenue
- 4. Counting income twice
- 5. Treating owner draws as expenses
- 6. Expensing loan payments
- 7. Ignoring small recurring charges
- 8. Missing receipts and records
- 9. Not tracking contractor payments
- 10. Doing it all at year-end
- Fixing them
Most bookkeeping problems we fix aren't exotic. They're the same ten mistakes, repeated for months until a tax deadline or a loan application exposes them.
1. Mixing personal and business money
Personal charges on the business card, business expenses on a personal card. It makes every transaction a judgment call, weakens your LLC or corporation's separation, and hides deductions. Use separate accounts and record unavoidable crossovers as owner draws or contributions.
2. Not reconciling
A bank feed is not a reconciliation. Without comparing books to statements every month, duplicates and missing transactions pile up unnoticed. See how to reconcile in QuickBooks Online.
3. Recording deposits as revenue
Marketplace payouts, card settlements and transfers between your own accounts aren't all sales. Recording deposits instead of actual sales misstates revenue and buries fees.
4. Counting income twice
An invoice recorded as income, and then the payment recorded again from the bank feed. Match payments to invoices instead.
5. Treating owner draws as expenses
Money you take out of a sole proprietorship, partnership or LLC isn't a deductible expense. In an S corporation, salary goes through payroll and distributions are separate. Getting this wrong misstates profit.
6. Expensing loan payments
Only the interest part of a loan payment is an expense. The principal reduces the loan balance. Split each payment using the lender's statement.
7. Ignoring small recurring charges
Software subscriptions, bank fees and processing fees add up and are often left uncategorized. Bank rules handle them automatically.
8. Missing receipts and records
The IRS expects records that support your deductions. Snap a photo of receipts and attach them to transactions; for meals and travel, note who, what and why.
9. Not tracking contractor payments
You need W-9s from contractors and a record of what you paid each one so you can file 1099-NECs in January. See our guide to the 2026 1099 thresholds.
10. Doing it all at year-end
Twelve months of bookkeeping in March means guesswork, missed deductions and a rushed return. Monthly bookkeeping turns year-end into a handoff.
Fixing them
If several of these sound familiar, a bookkeeping cleanup corrects the past, and monthly bookkeeping prevents a repeat. Start with our free monthly bookkeeping checklist if you're keeping your own books.
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