You finally did it last year. You cut the ties to your former employer and became your own boss. Now, you're inundated with government tax forms with all sorts of deadlines and beginning to appreciate the accounting department for all the invisible work they were doing on your behalf.

Here are three actions savvy entrepreneurs can take to maximize the benefit of choosing the proper accounting period: collect the data, weigh the pros and cons to determine the "business appropriate" accounting period, and continue to examine alternatives.

1. Collect the data.

Most first-year entrepreneurs have been running like crazy just to get the business going. Keeping the books is an afterthought compared to getting the product or service properly off the ground. The accounting typically consists of a simple cash-flow exercise: If there are funds in the bank then the business continues for another day.

But looming tax deadlines bring this inattention to accounting detail to the forefront, and without proper analysis, default decisions made in haste may lead to wasted opportunities. Instead, you should accumulate financial data throughout the year with an accounting software program for small businesses. Programs that allow manipulation of the data on a monthly basis are critical in this "business appropriate" period choice exercise.

2. Weigh the pros and cons of various accounting-period choices.

Business owners have a choice for their C corporation of electing a calendar tax year or a fiscal tax year.  This election is typically made when you file your first-year tax return. A calendar year-end is required if any of the following apply: you don't keep books; you have no annual accounting period; your present tax year doesn't qualify as a fiscal year; or the Internal Revenue Code or Income Tax Regulations requires a calendar year.

A calendar year is typically chosen for ease of use. Employee tax statements follow a calendar-year approach. Bank and investment-company statements with income statements also report on a calendar year. Most retailers report on a January 31 year so they can finish the year strong with Christmas sales.

While the majority of taxpayers elect a calendar year-end for tax purposes, a savvy entrepreneur examines the pros and cons and maybe elects a fiscal year-end. Reconciling from a calendar-year period to a fiscal year requires additional analysis, and if the company’s books and records aren't kept in good shape, this reconciliation becomes a time-consuming distraction.

But non-calendar year-end companies can also take advantage of lower professional fees because the "time crunch" falls outside of the typical "busy season" for most professionals. Customers are often aware that company sales personnel need to meet quotas before year-end, and often time purchases accordingly to take advantage of discounts.  Private fiscal-year companies often avoid large year-end discounts for a certain period of time until the customers catch on. For tax purposes, tax laws and regulations often have calendar effective dates. Fiscal-year taxpayers can also take advantage of deferred implementation of tax-law changes to their benefit.

3. Continue to examine your options.

Whatever choice you make regarding your tax season, it isn't irreversible. For tax purposes, you can change your year-end with the IRS by following the instructions on Form 1128. If you qualify, the change may be automatic, and a user fee wouldn't apply. If you don't qualify for an automatic change, you may request a ruling to change to a more appropriate year-end.

The proverb "haste makes waste" is applicable in this situation. Although the decision to change a year-end at a later time may or may not be available, a change after the initial year creates additional expense both in professional fees and lost benefits. First-time entrepreneurs should quickly pull together this analysis, determine the pros and cons, and run with their choice--but continue to analyze it to see if a change would be beneficial.