Hiring a Business Accountant? Look for These Important Qualities

It is easy to see the many benefits that you will experience when you choose to hire a business accountant. Not only will you save time on the daily financial tasks, but you can also tap into the skills that are needed to maximize the future success of your company. If you don’t already have an accounting team to help your small business, then you need to pick an accounting service as soon as possible.

Do You Need a Business Accountant?

The size of your company doesn’t matter, because you still need to track details such as payroll, expenses, sales, taxes, and more. Most entrepreneurs or small business owners don’t have the knowledge or experience to stay ahead of the numbers. So, they fall behind in the books and face a financial mess that needs to be cleaned up. Instead of getting caught up in these details, hire a business accountant who can track the financial information so that you can focus on other tasks that will help your company grow.

Not only will these business accounting services reduce your stress levels, but they also ensure that you are staying current with local and federal tax laws. You need to make sure that you are staying compliant with the laws to avoid potential fines and problems in the future.

Some business owners see the benefits of working with an accountant. But, they get overwhelmed with the task of choosing an accounting firm. Instead of over-analyzing the options, look for these important factors that will help with your decision:

Consistency and Reliability

When it comes to business financials, the details need to be looked at regularly. It is a bad habit to look at the numbers once and then neglect them for a few months. Instead, these details need to be managed all the time to ensure that reports and details are accurate when making big financial decisions.

Consistent service means that you talk to your accounting team throughout the year. If your current accountant only touches base when it is time to file your annual taxes, then you are missing out on many of the benefits of having a business accountant. Instead, you need to find a team that offers ongoing support and advice throughout the year. These services will ensure that you are staying on track with your business goals.

Look for an accounting team with a long history of success in the industry. This reliability will ensure that the accountants will stay consistent with the services that are offered for your business. You deserve an accounting team that offers timely, efficient services to support the needs of your company.

Industry Experience

Hands-on experience in the industry is much better than anything that can be learned in a book or classroom lecture. Choose an accounting team that has experience with other similar businesses. For example, if you are managing a start-up company, then it might not be the best solution to hire an accounting team that has been supporting large corporations with hundreds of employees. Instead, you will find more benefit by hiring a team that specializes in small businesses.

This industry experience will help you avoid some of the common pitfalls that new businesses face. Since the accounting team knows the potential problems that could come up, they will use proven systems to reduce the risk of these issues.

Systems and Organization

It is a red flag if you walk into an accounting office to see a mess of papers and files. If you are looking at an online accounting service, then you might be able to identify organizational factors in the way ongoing tasks and customer service are handled. Make sure that the team is staying ahead of the requirements, instead of missing deadlines and dropping important things that need to be addressed.

During your consultation with the accounting team, ask about checkpoints and reconciliation strategies that are used to ensure that nothing slips through the cracks. These details are important to ensure that your business receives the attention that it deserves.

Modern Tools

If you talk to an accounting team that suggests implementing a manual spreadsheet tracking system, then it is a good sign that you need to walk away and find another accounting service. Manual financial tracking is a thing of the past! There are so many great accounting software programs that will improve your results and maximize the future success of your company.

Using manual accounting methods means that you will miss out on important information that can be gathered from ongoing financial reports. It is hard to get a clear picture of the financial standing of your company if you are trying to crunch spreadsheet numbers or doing the math on a piece of paper!

The right business accountant will integrate a software program that will stay ahead of the reporting and reconciliations. This system will allow you to see real-time financial details. You have the opportunity to customize the analysis to match the needs of your company.

One benefit of the right account system is that you can avoid potential filing errors and reporting issues. This computerized program will systemize the process to reduce the risk of a manual error. As a result, you can maximize tax savings and avoid potential fines or fees associated with mistakes that could be made on the forms or tracking information.

Current Industry Knowledge

There is no doubt that the bookkeeping and accounting industry has become more complicated over the years. Business owners see the benefits of hiring an accountant because they are unable to keep up with the changing laws and trends in the industry.

So, you need to be sure that your accountant is proactive to pay attention to the changes in the laws and regulations. Tax laws change every year, and there are often small adjustments to employment tax rates, tax filing forms, and more. Unless you are focused on the accounting industry, you won’t be able to keep up with everything by yourself! Instead, you can lean on the expertise of your accountant to ensure that the team is taking care of the details.

Ongoing Strategy

Working with an accountant who focuses on the big picture can be a valuable way to help your company grow. This accounting advice is more than just basic information about how to fill out a tax form. You need a team who can assess the cash flow and current growth of your company, and then make recommendations to match your needs.

These accounting recommendations can be anything from tax advice to ways to changes that are needed for your financial system. Improving your daily habits and regular business practices can go a long way to boost your future success. For example, your accountant might help you see the way your company is struggling with cash flow, then make recommendations about the steps that can be followed to help you keep cash in the bank.

Many aspects need to be considered for future growth. Not only do you need the cash flow and investments to support growing inventory and workforce, but you also need to think about other overhead costs and maintenance. An experienced accountant will help you see the big picture so that you are prepared for any potential roadblocks that might be in the future. Managing the costs and income of your business will help you stay ahead of the trends so that you can take advantage of opportunities when they come along.

Personal Attention

You have unique concerns and requirements for your company, which means that you need personalized service from your accounting team. Choose a business accountant who is willing to have a conversation to understand your needs. Then, the services can be catered to match your business plan and requirements.

These personalized services are important to ensure that you aren’t getting a cookie-cutter approach that won’t work for your company. Instead, the systems will be designed to fit around your business goals, helping you achieve the long-term success that you desire.

Talk to the Leading Team in the Accounting Industry

If you are looking for a business accountant, then we invite you to talk to our team for more information. Here at Easier Accounting, we are working hard to provide the best small business accounting services that will support the needs of your company.

Before you decide to hire an outsource accountant, it is important that you learn more about the company that you would like to hire. As you research our business, you will see that we have built a solid reputation in the industry.

We understand the importance of a solid relationship with our customers. You can rest assured to know that someone is always available to answer your questions and offer the advice that you need. Not only will you receive honest, caring service from our company, but you will be working with a team that specializes in small businesses.

When you are ready for more information, talk to the experts in the industry: Easier Accounting. Call today to learn more about the ways that we can help your company: (888) 620-0770

FAQ about Outsourced Accounting and Bookkeeping Services

It is common for business owners to have a long list of questions when hiring outsourced accounting or bookkeeping services. If you are bringing in outside help to manage your business books, then it makes sense that you should hire someone you can trust. Ask questions before you hand over financial details so that you can learn more about the experience and services offered by the accounting team.

Easier Accounting is an accounting firm for both small and large businesses. We are always available to answer your questions. You are welcome to call anytime if you want to learn more about improving the financial future for your small business (888) 620-0770.

These are some of the questions that we often hear from business owners who are considering the services from an outsourced accounting team:

What Services are Available?

We offer a wide range of services to match the needs of each client. Instead of using a cookie-cutter approach for every project, our goal is to customize the services according to your preferences. So, we will ask questions about your business and systems that you already have in place. Then, we can make recommendations that align with your requirements.

These accounting and bookkeeping services include:

  • Monthly bookkeeping
  • Tax consulting
  • A dedicated accounting team
  • Audit support
  • Personal tax preparation
  • Business tax preparation
  • Annual tax planning
  • Payroll
  • Depreciation schedules
  • 1009-M creation
  • Conversion from accounting systems
  • Custom financial reports
  • Custom invoice layouts
  • And more!

The best thing that you can do is schedule a complimentary consultation to learn more about the services that are available. We will discuss your needs and offer recommendations so that you can choose the services that match your preferences.

How Will My Business Benefit from Outsourced Accounting Services?

Our job is to make sure that you have all your ducks in a row. We will evaluate your financial plan, keep up with ongoing tracking and reconciliation, and ensure that you are ready for tax payments and filing. These services will help you stay up-to-date regarding the financial health of your company. You won’t have any financial surprises at the end of the year when you are working with an experienced accounting team.

This information improves the likelihood that you can manage your cash flow and keep up with future expenses. Plus, you can refer to these reports when making big financial decisions for your company. Having a clear picture of the financial health of your business helps you to make educated decisions about future expenses, business development, and growth.

Why Outsourced Services instead of Hiring an Employee?

You have the option to hire an employee to help with bookkeeping and accounting. But, make sure that you understand the financial burden of bringing in another employee. Not only do you need to pay the full-time salary, but other associated costs include benefits, office equipment, office space, employment taxes, payroll, and more. These costs can add up!

Learn about the benefits of outsourcing, and you will see that you want access to the financial skills without taking on the burden of another employee. You can have your cake and eat it too… top-notch accounting expertise without bringing another full-time employee onto your team.

How Can You Manage the Books if You Aren’t in My Office?

Technology has opened up a world of possibilities for remote services. We don’t need to be in your office to look over your books. Instead, the work is performed remotely using a cloud-based software. We can view real-time information about your financial transactions, and work on financial reports and reconciliation from any location.

You can also tap into these online resources from anywhere. Even if you are gone on a business trip or out of the country for vacation, you will have ongoing access to the most current numbers for your company. This information can be accessed on your computer from anywhere in the world!

Don’t worry about security, because we always use secure methods when accessing your financial records. The could-based software is protected, offering a safe place to store your information.

Why is Cloud-Based Software Better than In-Office Accounting?

Manual accounting increases the risk of errors in the transactions. If you need to type in each transaction, then there is a possibility of missing keystrokes or typos. Instead, we have found that it is more effective to integrate a software program that imports transactions. Then, our team will review every transaction to detect potential problems.

Keep in mind that cloud-based accounting reduces the risk of losing all the financial information for your business. If your files are kept on the hard drive of your computer, then you could lose everything if the computer crashes. Or, paper copies of the records could potentially be ruined if a flood, fire, or natural disaster damages your building.

Why Shouldn’t a Small Business Owner Use a DIY Approach with Bookkeeping?

As a small business owner, don’t be fooled into thinking that you can handle the bookkeeping without the expertise from a financial professional. Most business owners are pulled by multiple responsibilities that include employee management, inventory, business development, networking, and more. You shouldn’t be wasting your time on busy work like bookkeeping and transaction auditing.

Hiring an outsourced accounting team will free up your time so that you can focus on more important tasks. You can turn your efforts to grow your business while the experts handle the financial details. As a result, you will find it easier to boost future success because you aren’t getting cause up in the busy work.

What are the Dangers of On-Site Staff Handling the Accounting and Bookkeeping?

You have the option to hand some of these responsibilities to your current staff. But, you need to evaluate the skills that the person has to offer, as well as the potential risk that could affect your company. For example, an inexperienced secretary handling the bookkeeping could result in missed transactions, mistakes, skipped reconciliations, and more. If the numbers are off, then it will have a domino effect to impact your financial reports and cash flow.

Another issue that you might face is potential fraud within the company. If you only have one employee managing the financial details, then transactions can be adjusted, and you won’t know the difference. Avoid theft and other problems by hiring a third-party outsourced team who can offer multiple checks and balances to reduce the risk of theft and fraud.

Can You Help with Taxes and Payroll?

We offer more than just basic bookkeeping and transaction management. You can expect full-service accounting solutions from our team. The monthly bookkeeping services are built around your annual tax plan. We will look at the numbers and help you put together an effective strategy to maximize write-offs and help you prepare for future tax filings.

At the same time, we can also offer ongoing support with payroll and other services that are needed. Our goal is to customize your services to match your preferences. So, we will help you identify the right monthly package to match your requirements. If you have questions along the way, then you are always invited to reach out to our team to learn more about how we can help.

What is the Difference Between Tax Accounting Services and Outsourced Accounting?

Most small business owners will talk to their accountant once a year: at tax time. Instead of waiting until tax season to work with our clients, we focus on the ongoing efforts that will maximize your overall financial success. We offer the tax preparation and filing services that you need, but these services are just a portion of your overall package.

In addition to annual tax filings, we keep up with the ongoing transactions that will impact your tax burden. This annual strategy is an important way for you to measure the financial health of your company and prepare for the future.

Will I Give Up Control of the Books if I Hire an Accounting Team?

No, you won’t give up control. You will still maintain full control over the financial books for your company. In fact, many small business owners find that they have more control after hiring an accounting team. When the transactions are kept current, you can trust the numbers that you will find in the accounting system. Then, you will be able to plan and allocate the funds as needed. You always have the final say when it comes to approving payments and invoices.

How Can I Learn More?

If you are interested in learning more about how your business can benefit from accounting and bookkeeping services, then we invite you to talk to our team here at Easier Accounting. We are working hard to provide the best services in the accounting industry. Our services are specialized for small business owners and entrepreneurs. So, you can rest assured to know that you are receiving services from a team with real-world experience in the industry.

Talk to us right away to see the benefits that are available for your company. We are here to help with anything that you need. Call today to see if our services are right for you: (888) 620-0770

Why Payroll is One of the First Things You Should Outsource

The quality of your staff is the foundation of a successful business. If you have skilled employees and contractors, then you can rest assured to know that things will get done and the business will keep moving forward. On the other hand, unmotivated employees can quickly bring down a company because of the poor customer service that is reflected.

As an employer, you need to be sure that you are proactively working to improve company culture. Happy employees will treat your customers right, helping you to increase sales and productivity. Payroll is an important aspect of employee satisfaction because your team needs to know that they will receive a correct paycheck in a timely manner. When payroll problems happen, it starts a domino effect that negatively impacts attitude and culture in your business.

Mistakes of Do-It-Yourself Payroll

If you are just getting started with your small business, then it makes sense that you are carrying many responsibilities. It is common for small business owners to carry the bulk of the responsibility, instead of handing some of these things off to employees and contractors. Not only are you looking for ways to cut overhead costs, but you also want to maintain control over the business.

Even though it might seem like a simple solution to handle the payroll by yourself, be aware that you could be causing potential problems for your company. Too often, small business owners don’t have the experience or knowledge to manage the business financial details. As a result, things slip through the cracks and mistakes are made.

Compare the costs of hiring a payroll service to help with your company, and you will see that it is cheaper to pay for this monthly service instead of dealing with the aftermath of a failing business because of payroll mistakes. These mistakes could cost thousands of dollars in employee turnover, back taxes, IRS fines, and more.

Is Payroll Software a Good Idea?

Using a reputable software program is a great place to start, but the software won’t overcome the human mistakes. The computer is only as good as the information that is entered into the software. So, you need to be sure that you are using accurate information when setting up the payroll details for your employees.

Depending on the software without using regular checks and balances could cause a domino effect of problems in the future. So, it is important that you have an experienced accounting and bookkeeping team in place to stay ahead of the details. The combination of the right software program and a knowledgeable team will set your company up for success.

Accounting Employee or Outsourced Payroll Services?

Now that you see the importance of hiring an experienced financial professional to help with payroll, the next step is to compare the options of an in-house employee or an outsourced payroll service. When you look at the numbers, it is easy to see why many small business owners turn to outsourced services to solve this problem.

If you hire an employee to manage payroll, you will need to pay their salary with extra costs on top for benefits. These benefits can cost thousands of dollars per year for health insurance, life insurance, paid time off, and more. Plus, you have the employee taxes and worker’s compensation fees calculated based on the amount that is paid to each employee.

Not only do you need to cover these taxes and benefits for an employee, but you also need to carry the cost burden of paying for office space to accommodate that employee. Other expenses might include office furniture, computer equipment, and office supplies that are needed so that they can do their job.

There is no doubt that it can be expensive to hire an employee. So, many small business owners are looking at options to bring on contractors for support instead. These outsourced payroll services offer all of the expertise that you need, without the burden of having an employee in your office. You get the best of both worlds: you can save money and have reliable, accurate payroll processing at the same time.

Benefits of Outsourcing Your Payroll Processing

Are you considering the option to outsource your payroll? Here are a few benefits that you can expect if you choose to invest in this service:

  • Save Time: There is no reason for you to spend your limited time on payroll processing. As a business owner, your time is better spent on employee management and company growth. Let someone else handle the busy work for payroll processing. Outsourcing these tasks will free up your time so that you can focus on more important responsibilities for the company.
  • Boost Productivity: How often do you feel like your day is taken up with busy work and seemingly mundane tasks? As the owner of the company, it can be hard to maintain productivity if you are constantly interrupted throughout the day. Plus, your productivity will go down if you are wasting your time on busy work. Outsource this busy work so that you can improve your productivity each day and maximize your results.
  • Decrease Expenses: As mentioned above, there are many costs associated with bringing another employee into your company. By working with a payroll provider, you can reduce the direct costs of payroll processing. Even if you have a large company that can support the salary of an in-house accountant, you still might consider the benefits of outsourced payroll services to minimize costs.
  • Avoid IRS Penalties: If tax filings and paperwork are turned in late, then the IRS will charge expensive fees and interest costs. Your risk of these fees will go up if you are handling the payroll without the support of an experienced accounting team. Small business owners often make mistakes, which can result in costly problems in the future.
  • Financial Security: Is your bank account and employee information secure in your office? Payroll processing can be risky if you aren’t using the right security features to protect the information. There are many security threats that you can run into in the digital age in which we live. So, it is a good idea to hire a company who will go above and beyond to protect your financial security.
  • Keep Employees Happy: One of the fastest ways to make an employee upset is by making a mistake on their paycheck. Reliable, accurate paychecks are the foundation of employee satisfaction. So, you need to make sure that you have a payroll team that will ensure accuracy for every pay period.
  • Expert Financial Advice: Hire the right payroll processing team, and you will have expert financial advice throughout the year. These accounting services can be much more than just writing the paychecks! The right accounting service will offer services for tax filing and management, as well as all other types of business financial support that you need. Take advantage of this expertise to help your company grow.
  • Regular Reconciliations: There are many benefits to having an outside party handle the reconciliations for your payroll and business transactions. These checks and balances will decrease the possibility of fraud or theft within the company. Instead of leaving this responsibility with an in-house employee, bring in an outsourced expert who can look for potential signs of employee fraud.
  • Current Expertise: Payroll services make it their job to stay ahead of the changes in the industry. If the IRS makes adjustments to tax rates, then you can rest assured to know that your company will stay up-to-date with these changes. You don’t have time to study the industry and keep up with these changes by yourself. Instead, bring in an outsourced service which is entrenched in the industry and retains current knowledge for mandates on the federal, state, and local levels.
  • Lower Stress Levels: How much do you stress every time you need to calculate payroll for your employees? This task can increase your stress levels and make it hard for you to relax during your free time. Instead of burdening yourself with high stress levels, outsource the work so that you can sit back and relax while the experts handle the details.

Hiring an outsourced payroll team is one of the best things that you can do for your company! Not only will you free up your time, but you can also have the peace of mind to know that you are missing some of the mistakes that are commonly made by small businesses.

It is important that you build the right team to support the future success of your company. If you are looking for ways to improve your financial systems, then you need to talk to us to learn more about the services that are available.

At Easier Accounting, we specialize in all types of business financial services, including payroll processing and tax filing. We invite you to call to schedule a consultation to learn more about the ways that we can support your small business. We are here to help with anything that you need! (888) 620-0770

How AP/AR Processing Impacts Cashflow Management

Cashflow management is a critical part of running a business. Without cash in the bank, your company can’t function! Cash is necessary for nearly every aspect of running a company, so you need to look to the future to ensure that you have the funds that are needed for upcoming expenses.

Unfortunately, cash flow is an issue that many business owners face. Have you found yourself in a situation where you aren’t sure if there will be enough cash to cover payroll or buy new inventory? Your business can’t move forward if you don’t have employees or product to sell. So, it is important that you make a few changes so that you always have the cash flow needed to keep your company running.

Foundation of Cashflow Management: AP/AR

When are you are working to improve your business cash flow, Accounts Payable and Accounts Receivable should be the area where you direct your focus. Invoices that are coming in and going out will impact the money that moves through your bank account. Accounts Receivable encompasses the money that is owed to you by clients and customers. Accounts Payable includes the money that you owe suppliers and vendors. You also need to be aware of potential shortfalls, which are times when the incoming funds won’t cover outgoing expenses.

Accounts Receivable has an obvious impact on cash flow since it is an overall picture of the money that you will be receiving from clients and customers. Sometimes, companies get behind in their invoicing, which delays the receipt of money because the invoices are so late. If you want to be paid, then you need to be sure that the invoices are sent promptly.

Also, late invoicing can be a problem for your clients who are trying to manage their own cash flow. Whether you are dealing with business-to-business transactions or you have individuals who are buying your services, most people will need to work to be sure that the cost fits into their budget. Having an invoice in hand as soon as possible makes it easier for your customers to manage their cash flow to pay the costs that are due.

Even though it seems like Accounts Receivable is the biggest influence on your cash flow, you shouldn’t overlook how much Accounts Payable will impact your cash position as well.

Accounts Payable and Cash Flow

Once you have dialed in the invoicing system and you have the money flowing in from customers, it is also important to make sure that you are controlling the money that is moving out of your bank account. Overhead expenses and other costs are unavoidable… it takes money to earn money! It isn’t a bad thing to have invoices that need to be paid, but you need to be careful to ensure that you are tracking business spending and avoiding unnecessary costs.

The biggest problem that you can face with Accounts Payable is failing to track upcoming expenses, and then facing a situation where you need to pay a large bill and the money isn’t available. Some business owners make financial decisions based on the amount of money currently in their bank account. Then, a big bill will come through, and they no longer have the cash to pay for the expense.

For example, if you land a contract with a big client and have an infusion of money into your bank account, then it might create a false sense of security that you can spend a little more than normal. Some business owners use this type of situation to justify extra costs such as new office furniture or hiring a new employee. Spending the money as soon as it comes in might result in an issue with cash flow later.

Even though the money was available at one point, what will you do when a large, unavoidable expense comes through? Tax bills are one area where small business owners can often get caught off guard, resulting in problems because they don’t have the cash to pay the bill.

With a little bit of planning, you can look ahead to see the anticipated costs that will be coming up. Then, you can work with an experienced accounting team to ensure that you are using the best strategies with incoming and outgoing expenses to support your future financial growth.

Tips to Improve Small Business Cashflow

Whether you are currently facing cash flow problems or you are looking for a way to improve your financial future, there are a few things that you can do to improve your account management and tracking. Here are some ideas to help you get started:

  • Know Where You Will Break Even: Your breakeven point won’t necessarily impact your cash flow, but it can provide an overall picture of the financial stability of your company. Having a clear picture of the profitability of your business will help you to see whether there is enough cash left over after the expenses are paid. If your breakeven point is too high, then you might need to ramp up efforts to increase profitability.
  • Always Have Emergency Reserves: It is hard to know when an emergency will pop up. Emergencies can be in the form of equipment that needs to be replaced or damage from a natural disaster. Your cash reserves can be used to keep your company running while you are sorting through the details.
  • Make Your Cash Work for You: If you are going to save money in an emergency account, then make sure that you choose an account that will help the cash work for you. Interest-earning accounts can help you maximize your investment and generate a little more income from the money that is sitting in the bank. Talk to your bank, or look into options such as CDs or money market accounts if you don’t need immediate access to the funds.
  • Expect Shortfalls: The goal is always to have more cash than you are spending, but there are times when shortfalls might occur. Some companies face these shortfalls during the slow season, while other companies face a slowdown in sales because of economic factors. Expect that you will face shortfalls at some point and be ready with your emergency cash reserves.
  • Anticipate Upcoming Expenses: A big tax bill or a cost to replace old equipment shouldn’t be a surprise. These expenses will roll through every so often, and you can evaluate your company to know when these costs will be due. Look forward to a few months and identify potential bills that you might need to pay. Then, plan accordingly so that you have the money in your bank account for these invoices.
  • Be Proactive to Collect on Invoices: Have a proactive person on your team working on AR invoices. Keep net-30 or net-60 pay terms, and always follow up if invoices are left unpaid.
  • Offer Incentives for Timely Payments: Are you running into problems with many past-due invoices? Consider offering some type of incentive to customers who pay early. For example, you could provide a payment discount if the payment is received in 7 days.
  • Establish Clear Payment Expectations: Written payment terms need to be provided to every customer. Set clear expectations about when payments are due and the penalties for late payments. Then, make sure that you are proactive to enforce those rules always.
  • Use Cloud Based Accounting: Staying ahead of the numbers will help you see the costs that are coming up. Cloud based accounting is a great option to consider because it helps you track expenses from any location. Make sure that you have a trusted employee or accounting team who can keep these numbers current so that you always have accurate reports.
  • Double Check the Accounts with Reconciliation: When transactions aren’t properly recorded in your accounting system, it could result in bounced checks or other cash flow You need to reconcile the accounts regularly to make sure that your accounting system accurately reflects the amount of money in the bank. Monthly reconciliations are a great way to identify the missed transactions so that you can fix the problems and balance the accounts.
  • Hire an Accountant and Bookkeeper: If you can’t keep up with the paperwork, transactions, and reconciliation, then it is time to hire someone to help. It can be expensive to bring on another employee, which is why you should consider the benefit of outsourced accounting services. An accountant has the experience and knowledge to know the best way to improve your financial outlook and help you stay ahead of cash flow

Do you have a hard time keeping up with financial management in your company? Then you need to hire a team to take care of these accounting details. Here at Easier Accounting, we work with small businesses and entrepreneurs to assist with payroll, tax preparation, and cash flow. Our team knows how to help you stay ahead of the accounting requirements for business. For more information, we invite you to contact us to schedule a consultation. We are always happy to answer your questions and we can cater your accounting services to match the needs of your company: (888) 620-0770

Avoid These Filing Mistakes on Your Tax Paperwork

Taxes are an avoidable part of owning a business, and tax season often adds stress and anxiety to many business owners. If you are dreading tax preparation, then you should consider the benefits of hiring an accountant to help with your filing. There is no reason for you to spend time on the paperwork when you could be focusing on other important responsibilities instead!

Problems with DIY Tax Filing

The biggest problem with doing your taxes without an accountant is that mistakes can be made that could result in big problems in the future. Even something that seems like a minor error could cost you quite a bit of money in fees and a big tax bill. At the same time, it is possible that you could be paying too much in taxes because you missed important deductions that could have been included.

If you don’t have formal accounting training and you are filing your taxes without the help of a professional, then it is likely that you are making a few errors along the way. These mistakes might not show up for a few years but could result in higher taxes or even an audit in the future. The best way to avoid these DIY tax problems is by hiring an accountant to help.

Prevention is always more effective than trying to clean up a big mess. So, work with a trusted accountant or bookkeeper to review your tax filing before it is sent to the IRS.

Avoidable Tax Mistakes

There is no doubt that an experienced accountant can help you avoid a lot of tax problems. Your accountant will check the numbers and make sure that everything is included in the filing. At the same time, a good accountant can also offer advice and services for payroll, estimated tax payments, cash flow, and more.

Here are a few common mistakes that you can avoid when you have a great accounting team working on your taxes and business financials:

  • Matching Taxpayer IDs and Names: Even though it seems like a simple thing, there are often problems where taxpayer IDs don’t match the names on the accounts. Whether the filing is for an individual or a company, it is essential to be sure that everything lines up to match the records that are on file. The IRS and Social Security have databases that connect taxpayer IDs with names, and audits are done to ensure that the filings match the database. If the name doesn’t match, then it could start a chain reaction of problems that need to be fixed.
  • Wrong Bank Account Number: It is easy to see why direct deposit is often the top choice for a tax refund. These deposits will land right in your bank account, helping you avoid the need to wait for a check to show up in the mail. But, be careful to ensure that the right direct deposit information is used. If you setup the direct deposit and one of the numbers is off in the account details, then it could be put into the wrong account. Or, the refund might be returned to the IRS. In this situation, you might not receive the refund because the IRS doesn’t have a policy to replace lost funds that are transferred
  • Incorrect Tax Rates: Whether you are figuring tax costs for payroll or self-employment, there are various percentages and calculations that need to be used to get it done right. These tax rates often stay consistent from one year to the next, although there are times when the laws change the rates that need to be paid. Make sure that you stay ahead of the changes in the accounting industry to ensure that you are using the correct rates when calculating tax payments.
  • Missed Estimated Payments: When you are just entering the world of self-employment, there are a few financial details that you might not understand without talking to an experienced accountant. For example, most employees pay taxes through deductions from their paychecks, then the annual tax filing is a time to ensure that the taxes were paid in full. With self-employment, you might not have regular paychecks with these deductions. So, you will need to make quarterly tax payments to the IRS. Missing these payments or sending the wrong amount could result in penalties and fees. So, make sure that you talk to an accountant to learn how much needs to be sent on your estimated payments.
  • Too Many Deductions: One of the benefits of self-employment is that you can take advantage of deductions. If you spend money on equipment or services for your business, then that money can be factored into your tax filing. But, there are times when small business owners try to take advantage of the situation by claiming too many deductions. Don’t put yourself at risk by deducting too many expenses! Instead, make sure that you understand the laws and only deduct items that fall within the guidelines.
  • Overlooking Deductions: On the other hand, there are times when small business owners are paying too many taxes because they overlook potential deductions. Whenever you spend money for your business, make sure that you hold onto the receipt and track the transaction. These details can ensure that you maximize your deductions as much as possible to minimize your tax burden.

As you can see, it could be easy to make a mistake on your tax filing. But, it is just as easy to take the necessary steps to check and re-check your taxes so that you can avoid these problems.

Do-It-Yourself or Professional Tax Services

How do you decide if you should spend the money for an accountant to take care of your tax filing? Business owners who attempt a DIY approach are often motivated to save money on the costs that they would have spent on the services of an accountant. Even though they think that they are saving money, a DIY approach could potentially cost more money in the future.

Tax filing not only takes a lot of time, but it is important to ensure that you have experience with tax preparation so that you get it done right. Most small business owners don’t have a formal education in accounting, which means that they are forced to study tax law in an attempt to figure it out.

There is no reason for you to waste your valuable time trying to gain expertise in tax law! Instead, learn enough so that you understand the process, but let a professional accountant take care of the preparation and filing. You can use this extra time to focus on ways to increase business profitability and grow your company.

If you choose a DIY approach for tax filing, these are a few ways that you might end up spending more money in the future:

  • Fees, interest, and penalties if the taxes are filed incorrectly
  • Missed deductions, resulting in a higher tax bill
  • Cash flow errors that cause an accumulation of interest costs and other financial problems
  • Incorrect tax rates, causing you to pay more than necessary
  • Lost money if the refunds are deposited in the wrong accounts

Without experience in the industry, you won’t know what you are missing! It is worth the investment to spend a little money so that you can hire a team to guide your company in the right direction.

Ongoing Preparation for Tax Season

Most business owners don’t think about tax filing until it is time to complete the paperwork each year. But, there are several tasks that need to be addressed throughout the year if you want to be ready to file your taxes. Failing to stay ahead of the financials all year could increase your stress levels when it is time to file your taxes. Not only will you need to sort through the mess, but you could potentially miss transactions that should be considered for your overall financial picture.

Make sure that you are keeping accurate records for Accounts Payable and Accounts Receivable all year long. It is also a good idea to complete regular reconciliations to catch potential errors that have occurred.

If you are planning to claim a transaction as a deduction, then you need to have the paperwork to back up the claim. Without a receipt or some type of documentation, you could face problems if an audit occurs in the future.

With a little bit of planning and consistent work, you can get ahead of these problems and stay current with your tax preparation. Most business owners find that it is much easier to work on small things throughout the year, instead of trying to sort through an entire year of transactions at tax time.

Do you need help with your tax preparation? Then it is essential that you talk to the professionals here at Easier Accounting. We focus on accounting services for small businesses, and our team is here to help. Call us anytime if you have questions about your tax filing or business finances: (888) 620-0770

How to Collect on Outstanding Invoices

Cash flow is a common problem that can make it difficult for small businesses to stay afloat. Do you have accounts receivable invoices that will be coming soon, but you don’t have enough cash to pay your current bills? If you are running into cash flow issues, then you need to enlist the help of an experienced small business accountant.

To keep up with overhead costs and ongoing expenses, you need to be sure that you are bringing in more money than what is being spent. The success of your company hinges on the positive cash flow, resulting in excess profits that can go to the owners and investors.

Primary Cause of Cash Flow Issues

What is the primary cause of your cash flow issues? Usually, these problems are based on the outstanding money that needs to be collected for accounts receivable. The truth is that this money can’t be considered income until you have the cash in your bank account. Even though you are anticipating payments that will be coming through soon, you can’t depend on that money until it has been received and the check clears.

Each time you put together an invoice, it is basically a short-term loan to that customer. You are trusting the customer to pay the money as agreed, but people don’t always follow through to pay as planned. Sometimes, the customer is dealing with their own cash flow problems, causing a domino-effect on their own overdue bills.

Unfortunately, it is common for business owners to be waiting on payments from customers. To make problems worse, small businesses don’t always have a good system in place to follow-up regarding collections. If you want to ensure the long-term success of your business, then you need to make sure that you are proactive to collect on any past-due balances that are owed by your customers.

Why Does Cash Flow Matter?

If the money will be paid eventually, why does it matter for you to receive timely payments? Without the cash to keep up with current expenses, your business will go under. You need cash on hand to cover costs such as:

  • Payroll
  • Rent or mortgage on the building
  • Utilities
  • Restocking inventory
  • The option to take advantage of expansion opportunities
  • Purchasing office supplies
  • Meeting debt payments
  • Reinvesting in business development
  • Be prepared for financial emergencies

For example, if the cash isn’t available to cut checks for employees on payday, then it is likely that you will lose your staff. These people will be angry and walk away from the company, resulting in a situation where you no longer have a team to service the needs of your customers.

It is a vicious cycle: cash flow problems can cause you to lose employees. At the same time, losing employees can contribute to cash flow issues because you will lose business. So, you need to take a preventive approach to ensure that you have the money that is needed to keep up with the operating costs of owning a business.

The Size of Your Company Impacts the Size of the Outstanding Accounts

Every company has outstanding invoices that need to be paid by the customers. As a company gets bigger, it is expected that these accounts receivable numbers will grow as well.

You need to learn how to manage you accounts receivables to ensure that your customers send payments in a timely manner. Keeping up with the growth will give you the opportunity to continue growing.

You don’t necessarily need to do all of these tasks on your own. In the beginning, it is common for a small business owner to oversee most of the financial details, including bookkeeping and collections. But, eventually, you will need to hand these tasks over to a professional team so that you can focus on other aspects of running a business that need to be addressed.

How to Collect on Past-Due Invoices

Now that you can see the importance of staying current with collections, you are probably wondering how you can implement this strategy into your business. It is one thing to understand that you need to be collecting on the invoices, and it is a whole different situation to make changes to follow through on these principles.

These are a few strategies that you can use to collect the money that is owed by your customers:

  • Ask Questions to Understand the Situation: Without an understanding of the customer’s current situation, it might be hard for you to find a win-win situation. Most customers have the desire to pay the bill, but they are running into issues with disorganization or cash flow problems. So, you should start the conversation by asking why the invoice hasn’t been paid. Sometimes, it is as simple as the invoice being overlooked on a messy desk, and they will send the money right away. Other times, they might need a little more flexibility in the payment terms. So, you can have an open discussion to understand their needs, and then put together payment terms that will work for everyone involved.
  • Put Together a Collection Policy: One of the reasons that you aren’t receiving the money that is due is because you don’t have a solid collection policy in place. Take time to design a plan that will work for your business, then make sure that you are consistent in following through in the enforcement of that plan. Include details about fees and interest costs that will be accrued for the past-due balances, and provide a copy of these details to every customer. The best solution is to inform customers about the collection policy in advance so that you can prevent missed payments in the future.
  • Send Reminders: In the beginning, you shouldn’t jump to conclusions that the customer isn’t going to pay the invoice. Instead, send a gentle reminder with a copy of the invoice so that they can remember the money that is due. This reminder could be in the form of an email or a letter in the mail. Try using different communication channels if you don’t hear back.
  • Follow Up with a Phone Call: If you are sending invoices in the mail or via email, it is possible that the paperwork is overlooked in a busy office. Send the reminder, then consider the advantages of following up with a conversation. A quick phone call can go a long way to clear up any misunderstandings regarding the payment of the invoice.
  • Provide Other Payment Options: Is the customer skipping a payment because they don’t have the cash available to write a check? Offer another option that can be used to pay the bill. For example, you might consider a credit card payment option if that works better for the customer. Business owners often prefer to avoid credit card payments because of the payment processing fees that are incurred. But, these fees are much better than not receiving the payment at all.
  • Setup a Plan for Installment Payments: Another way you can work with the customer is by finding a payment schedule that will match their abilities. For example, instead of demanding the full payment right now, you could offer installment payments to be sent over the period of a few months.
  • Send a Certified Letter: A certified letter probably isn’t worth the cost if you are trying to collect a small balance. But, if you have a customer with a large outstanding invoice, then it might be worth the effort to send a certified letter requesting payment. Talk to your lawyer to get an official letter threatening legal action if the money is not provided by a certain day.
  • Hire a Collection Agency: In the worst situations, you might consider hiring a collection agency to follow up. If you choose this option, expect that you will pay a high percentage of the payment to the agency. Typically, you will only need to pay if the money is collected. Even if you can only recover a partial payment and a portion of that goes to the agency, you are still in a better financial situation compared to not receiving the money at all.

There isn’t one strategy that works for every business, so it is best to consider the needs of your company. You can use one or more of the strategies listed above to find the best solution to stay ahead of your accounts receivable issues.

Hire an Accountant to Help

As a business owner, there are many responsibilities that you need to juggle each day. It can be overwhelming to keep up with everything, especially if you are facing stressful cash flow problems. Instead of feeling bogged down by the responsibility, you should consider the benefits of hiring the experts to provide the personalized support that you need.

Here at Easier Accounting, we understand the ins-and-outs of financial management for small businesses. Our services are designed to make it easy for you to keep up with the responsibilities of growing your business. If you have questions about cash flow, accounts receivable, or any other financial issue, we invite you to contact our team to learn more about the ways that we can help: (888) 620-0770

Why You are Leaving Money on the Table if You aren’t Outsourcing Business Systems

When it is time to hire new talent, should you bring on a new employee or look for ways that the services can be outsourced? As a business owner, it can be a lot of work to manage employees and contractors. So, you need to be sure that you have solid systems in place to help you maximize your results.

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Changes in Hiring Trends

For many years, companies depended on a staff of in-house employees to complete their work. But, times have changed, and many businesses outsource some of their operations. Outsourced talent can be beneficial for many reasons. In today’s workplace, it is wise to consider what benefits your company could experience by doing so.

The problem is that some employers are nervous about the idea of bringing in outside talent. If the contractor isn’t employed by the company, will you lose control of the quality of work and the project outcomes? Not necessarily. The truth is that outsourcing might be the solution that you need to take your results to the next level.

When companies start to see the benefits of outsourced talent, they start to make the change to integrate more contractors and hire fewer direct employees. If you haven’t caught the vision, then we want to help you see why it might be smart for you to incorporate these changes into your organization.

Save Money with Outsourced Talent

It is easy to forget how much a single employee can cost your company. You might look at the salary and see the base wage that is spent on that individual. But, you also need to consider other employment expenses that can add up over time. It can be difficult to calculate all of the expenses since there are so many factors that increase the cost of doing business when you bring on another employee.

The costs of hiring an employee can include a variety of expenses, including:

  • Salary
  • Employment Taxes (Social Security, Medicare, FUTA, State Unemployment)
  • Worker’s Compensation Coverage
  • HR Management
  • Office Space
  • Health, Vision, and Dental Insurance
  • Retirement Savings Accounts
  • Computers and Equipment
  • Onboarding and Training
  • Paid Time Off
  • Recruiting Expenses
  • Cost of Payroll Processing Services
  • Legal Fees
  • And More

As a general rule of thumb, you can expect to pay 10% on top of the employee’s salary for taxes. Then, the other non-tax expenses still need to be added on top of this figure. Not only do you need to meet regulatory requirements, but you also need to be sure that you are providing the benefits that many employees expect.

Instead of increasing your overhead by paying for all of these expenses, a cost-effective solution may be to bring on a contractor who has the experience that you need. You can save the 10% cost for employment taxes because the contractor is required to manage their own withholdings and other taxable expenses.

Since the contractor doesn’t work in the office, you may not need to provide office space, equipment, supplies, or any of the other miscellaneous tasks that can add up over time. Additionally, you can save the money that would have been spent on benefits such as Paid Time Off, health insurance, and more.

Maximize Output and Manage Payable Hours

Hiring an employee means that you will need to pay them for every hour that they spend in the office. But, a contractor is only paid when they are performing work that applies to your project. For example, when employees take paid breaks or spend time talking to coworkers instead of completing the required tasks, you are still paying them for the hours that they are in the office. On the other hand, a contractor will charge either a flat fee for the service or they will stop billing if they step away from the project.

Many times, employees are engaged in a variety of tasks during the day. When you are paying an hourly rate, you will be spending the same amount of money if the person is filing paperwork or working on complex data analysis. There are often times when employees are hired to work full-time, but they can complete their responsibilities in 25 – 30 hours during the week. The other 10 – 15 hours are spent on menial activities to fill the time.

When you hire a contractor, that person brings a specialized skill set that will be used, without the need to pay for busy-work to fill the rest of their time. You can pay a certain amount for a specific number of hours each week, and the contractor spends the rest of the week working for other clients. As a result, the contractor can maximize their income, and you don’t have to bear the burden of paying a full-time salary for that person.

Leveraging Business Results for the Future

Another financial factor that needs to be considered is the way you are leveraging results to create future success. One reason you might be leaving money on the table is that you are spending your time on busy work instead of business management.

Business owners carry many responsibilities throughout the day. It is common for an owner to be involved in employee management, product development, and data entry during different times of the day.

But, you need to consider the best use of your skills and how you can increase your personal performance. If you are spending a part of your day on busy work that could be outsourced, then you are possibly stunting your business by spending your precious time on other more profit-generating activities.

For example, how much time do you spend on things such as data entry, payroll processing, and filing paperwork? These tasks are important to maintain the organization of your company. But, they are things that can be outsourced to specialists so that you can focus on the higher priority tasks. As the owner of the company, you shouldn’t be wasting your time with the busy work!

Some business owners continue these tasks because they don’t want to bring on the burden of another employee. In the above example, it can seem like an expensive solution to bring in a full-time employee to handle financial tracking, bookkeeping, and reporting. Instead of doing so, you should consider the benefits of an outsourced contractor. A qualified contractor is an expert at their craft. The efficiency of their work will likely result in economic savings to your business, resulting in less overhead. You can be selective about a contractor with the specific skill set that you need, and you can improve your business’s systems and operations.

Better Skillset, Better Results

Contractors have the advantage of working on multiple projects in the same industry, giving them a specialized skillset that can’t be gained by working for a single employer. These skills can amplify the results that you get from the work that is completed.

To share an example, consider the benefits of hiring a bookkeeping or accounting service for your company. If you encounter a financial situation that needs to be addressed, the contractor is more likely to have the necessary knowledge from work that has been done on other projects. In comparison, an employee might not have the same depth of knowledge and experience compared to the contractor.

The best way to maximize your future results is to be sure that you construct a team of people who are working together in a synergistic way. Contractors will often give you the opportunity to test their services, allowing you to move on to another option if it isn’t working out. In this scenario, you don’t have to worry about unemployment costs or severance pay that might be required if you were letting go of an employee.

Financial Benefits for Your Company

As you can see, there are many reasons why you should consider hiring contractors instead of employees. Not only can you save money by cutting out the excess costs of an employee, but you can also infuse your business with new talent that can propel you to future success. If you want to take advantage of these benefits, then you need to look for ways that you can use outsourced services instead of hiring employees.

Are you interested in learning more about how you can benefit from outsourced accounting services? Here at Easier Accounting, we have optimized our systems to help people like you. By focusing on accounting services for entrepreneurs, small businesses, and start-ups, we can bring the specialized skills that are essential to help your financial success.

We invite you to contact us to learn more about the ways that we can help your company. Don’t rush into the decision to hire a full-time accountant for your company. Instead, we encourage you to talk to us so that you can see the benefits that are available from outsourced accounting. We are here to help!

Call our team at Easier Accounting to ask questions and get information about the services that can be customized to match the needs of your organization: (888) 620-0770


Important Accounting Tasks that need to be Done Weekly

How many responsibilities and tasks do you manage each day in your small business? Entrepreneurs and small business owners often wear many hats throughout the day, and it can be hard to keep up with the long list of responsibilities.

Too often, business owners get caught up in the daily stresses of managing a company, and standard business practices fall to the wayside. If you are letting important bookkeeping and accounting tasks stay on the backburner, then you are setting yourself up for problems in the future.

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Instead of waiting for everything to fall to pieces, it is better to take a proactive approach to managing your business finances better. You will see that ongoing accounting and bookkeeping are critical to support the financial health of your company. These tasks are easy to do and easy not to do, but they will make a big difference to help you avoid the major issues that you could be facing in the future.

Putting Together a Business Plan

The first step to a good accounting and bookkeeping system is to be proactive with your financial plan. Good intentions don’t go very far to make sure that the bills are paid, and the accounts are balanced. So, you need to put together a plan that is realistic for your business, to ensure that there is accountability to complete the small tasks.

This plan needs to include activities that will help you properly record the transactions, stick to a budget, and look for irregularities on a consistent basis. Write down your plan and your goals, so that you can refer to your notes when there is a question.

Many small business owners don’t have the financial education to know how to put together a plan that is going to work. So, you should strongly consider the benefits of talking to an accounting professional if you want to ensure the long-term success of your company.

Here is a list of tasks that should be included in your business financial plan:

Task #1: Check Your Cash Position Daily

When you have money moving in and out of the bank account, you need to make sure that there is always enough to cover the payments that will be coming through. It has been said that cash is king, and there is no doubt that the business will run into trouble if you don’t have cash.

Some business owners start their day by checking their email and looking at local news sites. Instead of getting caught up in the online noise, you need to log into your financial accounts to see the status for the day.

Look at the balances that are in each account. Then, consider the money that you are anticipating to receive during the week. Finally, consider the bills that are due to ensure that you have enough money to cover those expenses. Daily awareness of your cash position can help you avoid problems such as overdraft fees or bounced checks.

Task #2: File and Document Transactions

If you want to maximize the profitability of your company, then you need to be leveraging tax write-offs that are available. But, it is hard to track these expenses if you aren’t keeping records and documentation. We agree that it can be a hassle to manage receipts and paperwork, but it is a necessary part of owning a business. Without this documentation, you will either miss potential deductions, or you could be facing an issue if the IRS audits your company and you don’t have the receipts to back up the write-offs.

Have a good filing system where you can store invoices, receipts, and documentation for anything else related to money that was received or spent. You might consider putting together a vendor file for each business that you work with. Or, you could record the receipts by month if you prefer.

The best solution is to ensure that these documents are recorded in your online system first, then have a filing cabinet where the hard files are kept. If you need to refer to a specific document, then you can look at your computer accounting system to find the transaction. Then, you will be able to locate the paper in your filing cabinet quickly.

As a business owner, you shouldn’t be worrying about paperwork filing and other busy work. Instead, have a secretary or a bookkeeper assigned to this task. Then, you can focus on other responsibilities without worrying about receipt management.

Keeping up with transaction recording and document filing often only takes a few minutes each day. But, you will be facing hours of work if you procrastinate it for a few weeks or months.

Task #3: Send Outstanding Invoices

Invoicing is an essential task to ensure that you are receiving money to pay for your business expenses. Sometimes, the invoices get lost in the pile of paperwork. If you have delivered services to a customer, then you need to make sure that you follow up with an invoice to get paid.

Putting together an invoicing system is essential to ensure uniformity when you send each request for payment. Many accounting systems have built-in invoicing features, so you don’t need to worry about creating invoices manually.

The best strategy is to have a set day of the week when invoices go out. Once a week, assess the work that was delivered and put together the invoices. Maintaining this consistency increases the likelihood that you will be paid promptly because your customers will know what to expect.

This schedule also gives you the opportunity to look at accounts that are past-due, so that you can send out reminders if needed. On the invoices, make sure that you have detailed information about the due date of the invoice, as well as payment options that are offered.

Task #4: Review and Pay Your Bills

Sort through the invoices that you have received from your vendors to make sure that you know the costs that are due for the week. Staying ahead of these invoices will help you to avoid unnecessary costs for late fees and interest payments. As you look at your Accounts Payable report, you need to make sure that you were billed correctly for the products or services that you received. Also, consider if any of the vendors offer discounts for early payment.

If you are having cash flow problems, then you might need to reach out to the vendors to negotiate different payment terms. These conversations can help you to streamline your cash flow and anticipate upcoming costs.

As you are looking at the bills that need to be paid, it is a good idea to assess your anticipated cash flow. For example, if you have a big payment due in a few weeks, then you need to make sure that the bank account will be padded enough when the payment processes. Sometimes, it is necessary to get creative with the timing of the payments as they move through your account.

Task #5: Assess Costs and Expenses

Instead of paying every bill that comes across your desk and then moving onto the next task, consider the benefit of assessing each expense to determine if it is a necessary cost for your business. Too often, small business owners have a long list of subscriptions and services that add to the bottom line. You need to go through these line items to determine if they are needed.

Look for “extras” that you aren’t using on a regular basis, and cut that expense to improve your cash flow. For example, you might be able to cut back on software subscriptions by consolidating all of your accounting tasks into one system. Not only will you simplify your business management, but you can save money at the same time.

Hire a Bookkeeping and Accounting Team to Help

You are already managing enough responsibilities without worrying about the daily and weekly financial busywork. Instead of spending your time chained to your desk and crunching numbers, it is better to hire a bookkeeping and accounting team that can help. These services will give you the opportunity to focus on the management of your company, and you can rest assured to know that you have a financial professional taking care of the ongoing details for your business.

Accounting and bookkeeping services are a valuable way to ensure the future success of your company. Managing the numbers will give you information about the financial health and what you can expect in the future. If you are ignoring these basic tasks, then you can anticipate that you will need to work through a financial mess in the future.

Do you need help with ongoing accounting tasks? Our team at Easier Accounting is here for you! We are experienced in small business accounting, and we know the best systems to improve the future outlook for your company. For more information about the services that are offered, call us to talk to one of our expert team members: (888) 620-0770

5 Things You Need to Do Before Talking to Your Accountant about Taxes This Year

Tax season is here, making many small business owners groan at the idea of scheduling an appointment with their accountant for tax preparation. Whether you own a small business or you are an employee, taxes are unavoidable. But, there are more things that will need to be done if you are filing your personal taxes as well as your business taxes.

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If you have an appointment scheduled or you are getting ready to talk to your accountant, there are several things that you need to consider before the meeting.

Do-It-Yourself vs. Professional Tax Preparation

The first question to ask is whether you should file your taxes on your own or hire someone to help. Even if you have completed your personal taxes in the past, it is important to know that business taxes are a bit more complicated. Even if you feel comfortable filing your tax return, it is suggested that you work with a tax professional for all business-related tax questions and filings.

Remember, tax laws change every year. So, you need to be sure that you have an accounting professional who is keeping up with the trends to ensure that your business is compliant with the new laws.

There’s no reason for you to spend the time trying to decipher tax laws! Your time is better spent on growing and running your business. Outsource your tax preparation to save yourself a headache that often comes during this time of year.

Even if you are outsourcing your tax preparation, there are a few things that you can do to be ready for the meeting with your accountant. Here are five steps that should be followed before the meeting:

Step #1: Gather Tax Paperwork

If you are filing personal taxes as an employee, then you only need to worry about a W2 and a few other financial documents for the tax return. But, there are many other documents that will need to be gathered and provided to your accountant for a business tax return. You might receive 1099’s and other statements of income. It is also a good idea to bring forms showing details about your bank accounts, investment accounts, debt interest payments, and more.

This tax paperwork shows your accountant the financial map, helping them to see the annual picture of your business income and expenses over the course of the fiscal year. Providing the paperwork decreases the likelihood that a miscommunication will occur. With this information, the accountant can crunch the numbers and figure out the best strategy for filing your taxes.

You might provide them with a stack of paperwork and call it good. Or, you might have a summary page that maps out the accounts to provide an easy-to-reference sheet for the accountant to review. Talk to your small business accounting team to see if they have any specific requests about what information you should provide during your tax appointment.

Step #2: Provide Payroll Details and Estimated Tax Payments

How much did you pay in payroll and payroll taxes? These numbers are necessary for your business tax filing. If you were consistent with tracking financial information throughout the year, this should be as simple as running a report in your accounting software to provide to your accountant.

However, it is a good idea to do an audit to ensure the reporting information is correct. These internal audits should be performed on a regular basis to identify potential mistakes or errors that were made in payroll processing or during data entry. Identifying these problems before tax filing time can help you avoid problems later.

It is also important that you provide detailed information about any estimated tax payments that were made. These tax payments should include quarterly taxes as well as other tax expenses such as employment taxes. Your accountant can help you stay ahead of these payments all year long to ensure that you don’t miss any of the necessary deadlines.

Step #3: Details about Expenses and Tax Deductions

One of the most powerful benefits of owning a business is leveraging tax write-offs where appropriate. If expenses are business-related, you can write off those costs on your taxes and reduce the amount of taxable income that will be factored into the return.

What types of expenses can you write off? It varies, depending on the type of business. If you have a home-based business, there are a few things that your tax accountant might ask about, such as utility bills, mortgage payments, and cell phone usage so that an appropriate write-off can be calculated. Other write-offs include the cost of business development, equipment, a company vehicle and more.

Here is a list of potential expenses that you might be able to use as tax deductions:

  • Marketing or advertising costs
  • Local transportation, including a mileage log for your car
  • Travel costs, including airfare, meals, hotel, taxis, and any other costs that were incurred
  • Phone lines, including cell phones, VOIP, and land lines
  • Internet, computer, and software costs
  • Payments made to subcontractors
  • Insurance and certification premiums
  • Depreciation of old assets
  • Office supplies
  • Rental costs
  • Utilities
  • Professional expenses for consultants, accountants, and lawyers
  • Bank and credit card interest expenses
  • In-home office deductions
  • Payroll costs
  • Health insurance premiums
  • Estimated tax payments
  • Maintenance and repairs

This list is not comprehensive. But, it will give you a good idea about the types of expenses that your accountant will be asking about.

The best thing that you can do is talk to your accountant in advance about potential write-offs that should be tracked for the year. Keeping detailed records of all of your expenses will ensure that you can use the deductions where they are appropriate. In some situations, you might choose to strategically purchase equipment or furniture before the end of the year in order to minimize tax burden. Other times, it might make sense to wait until January rolls around so that those deductions are available for the next year.

Make sure that you have receipts and documentation to back up the purchases that happened throughout the year. These deductions can be problematic if you don’t have documentation in case an audit happens in the future.

Step #4: Summarize Cost of Goods Sold

If your business sold any goods, you would need to have details about your inventory, including the total beginning dollar amount, purchases, and the ending dollar amount. Materials and supplies expenses also need to be figured into the business financial documents, so that you can determine overall profits and tax burdens for the year.

These numbers might seem overwhelming if you don’t know a lot about accounting. That’s why it is essential to have an experienced tax team who can offer advice and support all year long. Don’t wait until tax season to prepare the information for your accountant! Instead, have a solid system in place that will be used on a daily, weekly, and monthly basis to ensure that you have all of the financial information that will be needed.

Step #5: Bring Your Questions

Taxes can be complicated, leaving many small business owners confused about how the numbers worked out. If you have questions during the tax preparation process, it is important that you talk with your accountant to help you understand the details of the filing. Even though your tax accountant is managing the numbers and the paperwork, as a business owner, it can be very helpful for you to at least have a basic knowledge about how the calculations are summarized for the filing.

There are times when your accountant might come to you asking for specific information. Keeping open lines of communication will ensure that you have a good team to minimize the tax burden and maximize the final results.

What types of questions should you ask? Anything goes! Full-service accounting provides you with a great resource that you can tap into all year long. So, don’t feel like you need to wait until it is time for tax preparation before you talk to your accountant about the questions that arise. Strategic accounting can minimize the stress during tax time and make it easier for you to gather the necessary information when it is time to file your taxes.

Talk to an Experienced Accounting Team

The annual tax deadline is drawing near, so be sure that you are ready to have your paperwork submitted by the deadline. April 15th is the standard deadline each year. But, since this date falls on a weekend, you will have until April 18th to file your Federal tax return this year. The due dates for state tax filing varies depending on your location. It’s always best to talk to your accountant to ensure that you don’t miss the local deadlines.

Do you need help with your tax preparation? Talk to a small business accounting team to get the best service that can be catered to meet your needs. These services will ensure the financial success of your company, helping you to optimize profits and prepare for the future. For more information, talk to our team here are Easier Accounting to learn about the services that are available: (888) 620-0770