The only cut is made with the squirrel positioned belly up, I hold them by the base of the tail. The cut is made between the anus and the body, right at the lower edge of the anal opening. Cut through the skin, bone, and tissue right to the meat. I like to widen the cut by skinning just an inch on either side of the base of the tail along the back. Step on the tail, grab the squirrel by the hind legs and pull up. The front half will be quickly and neatly skinned. I pull until the skin is past the neck where I want to cut off the head.
Now, shift your grip from the rear legs and grab the remaining skin on the belly. Pull that up and the hide will slide off the rear half of the squirrel. I then use game shears to snip off the feet and head. You have a completely skinned carcass, minus the feet and head. If you dipped it in water before the skinning started it'll be hair free. Gut the squirrel and you're ready to wash the carcass. Or, dismemeber for washing/soaking in salt water. Again, while in the field at the creek, lake, or pond where I do my cleaning, I use the game shears to seperate the four legs and back. So all I take home is the ediable portions and no worries about getting rid of hide, or intestines, ect...