Finally spring is in the air, what a wonderful feeling; unfortunately it's also that time of year again when small business owners and independent contractors are dreading the Schedule C on their tax returns.

If you have not kept fastidious records of your business expenses for 2005, or you are new to operating as a sole proprietor, this is the time of the year to start your tax planning. Ask yourself, are you ready for the IRS Š and for that matter the FTB, and the EDD and the BOE?

My most common advice when it comes to small business taxes is to find a tax and bookkeeping professional that can understand your business and your recordkeeping needs.

New businesses have a number of options: they can maintain all the books themselves, hire a part-time bookkeeper, hire someone to just do your taxes, retain a CPA, or set-up a hybrid system where they maintain daily records and work with a professional on a quarterly basis.

Business owners need to consider their own abilities and time constraints to perform the recordkeeping tasks.

Regardless, it is important for business owners to be personally involved in the tax-planning and control of the record-keeping system of your business. After all, it is your business.

When shopping around for a professional tax preparer or bookkeeper, first look for someone who understands small business and is up-to-date with the federal and state tax laws.

Secondly, it is important to look for a professional that has experience in your industry and has local references.

Too often many of our start-ups will utilize a family member, like Aunt Irma, that used to be a bookkeeper 20 years ago.

Aunt Irma may be a very nice person who is willing to do your books for pennies, but unfortunately if she is not in-tune to new tax laws your business may lose out in the end. Getting things done right the first time will cost less in the end.

Thirdly, find a professional that you trust, that you can work with, and one that takes the time to explain the financial statements they will be producing for your business.

If you choose to develop your own record-keeping system and prepare your own taxes start early and be consistent.

A survey conducted by David Michaelson & Associates for Turbo Tax, stated that the biggest tax woe for small business owners is finding enough time to prepare and file their taxes.

The survey also found that the average small business owner (with less than 20 employees) devote an average of four hours per week or 208 hours a year to tax recordkeeping and preparation.

Some other "pre- recordkeeping tips" to think about as you launch your business include: know your deductible expenses, keep a written journal (diary) to record your thoughts and actions regarding your business, start a beginning expense journal and start making a "fun habit" of collecting business receipts.

According to the IRS, deductible expenses are those expenses allowed when computing the net profit (or loss) of taxable income at the end of the year.

Many people refer to this as a "write-off," which is a misnomer, because you are still paying for these expenses.

IRS agents refer to deductible expenses as true business expenses, which can minimize your tax liability. If you are uncertain about what allowable deductible business expenses are, the IRS provides Publication #535 Business Expenses, which can be downloaded from the IRS Web site at ww.irs.gov at no charge.

I encourage start-up businesses to get a copy of that publication as well as Publication #583: Starting A Business and Keeping Records. For those who are operating a home-based business Publication #587: Business Use of Your Home has pertinent tax information.

The Internal Revenue Service has come a long way in becoming more "user-friendly" for its millions of self-employed customers.

Perhaps, they have realized that if our small businesses are profitable and stay in business then eventually the IRS can collect more taxes.

The IRS Small Business/Self Employed One Stop Resource (www.irs.gov/businesses/small) even provides an on-line classroom with varied tax topics and streaming video. The workshops are quick and educational and a little easier to read then most IRS forms and publications.

What ever your recordkeeping needs, the Napa Valley College Small Business Development Center has resources available for low or no cost to our local business owners.

Our resource library is full of reference books on recordkeeping and tax information and we have sample record keeping software that we provide to clients free of charge.

Several of our SBDC business counselors are trained in QuickBooks 2005 and 2006.

Additionally, on March 29 we are providing a Payroll and Worker's Compensation Strategy workshop at the Napa Chamber of Commerce from 6-8:30 p.m.

The training, which is provided by Teri Johnson of Bookkeeping & More, is a starting point for small business owners who do their own payroll.

The cost is $45 and includes a training manual. Please call the Napa Valley College SBDC at 253-3210 to access these recordkeeping resources.

Elizabeth Pratt is the director of the Napa Valley College Small Business Development Center and a business instructor of small business management and business communications at Solano and Napa Valley colleges. She lives with her husband and two children in the beautiful Napa Valley.