Not keeping financial records up to date is the biggest headache. First, you are required by law to keep accurate and accessible financial records. Second, it is important to your P/L statement to keep the best financial records possible to obtain further capital, etc.
Inc.com states miscalculation of employee status is another no no. I agree! “This issue is becoming increasingly important as more businesses outsource jobs to contractors. It is also something the IRS has been paying close attention to, so be cautious! Misclassification can result in big fines and government scrutiny. Play it safe and classify accordingly,” according to Inc.com.
Finally, not incorporating your business. If something goes wrong, an unincorporated business puts the owner(s) at personal financial risk. An incorporated business does not. So, it is better to incorporate in most cases.
Twyla N. Garrett