When is the Best Time to Hire an Accountant?
When Should I Hire an Accountant?
In general, hiring an accountant is a difficult process. There are many factors and variables which have to be considered when deciding whether or not a given candidate should be hired. Whenever possible, business owners should take the time to integrate bits of wisdom on hiring an accountant so that the whole process can be simplified.
Toward this end, here are a few nuggets of wisdom which will help you to figure out what time is the proper time to hire an accountant. Knowing when to hire an accountant is oftentimes as critical as knowing who to hire. The nuggets are as follows:
During Business Growth
Is your business growing at an impressive rate? Now is the prime time for you to hire an accountant. They can help you navigate the finer details of your business growth and make sure you don’t blow your success before you have the opportunity to fully enjoy it.
When You First Start a Business
You may not think about it, but when you first start a business you desperately need to hire an accountant. Your accountant can help you get your finances and bookkeeping organized before the real hustle and bustle of your business begins.
When You Hire Other Employees
Are you ready to hire a new employee? There is no time like the present time to go ahead and hire an accountant. Hiring an accountant when you’re ready to hire other employees will ensure that you don’t lose a ton of money by taking on a new employee the wrong way or before you actually have the money to pay them.
Before You Need One
Don’t wait until you desperately need an accountant to hire one. In most cases, waiting until you need one means you’re probably too late. The sooner you can afford to hire an accountant, the better. If, for some reason, you can’t afford to pay an accountant, find one who can offer pro bono work or even see if you can barter your services.
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How an Accountant Can Help a Business Succeed
Business Success
If you are a small or large business owner you have probably spent a significant amount of time trying to figure out how to make money, how to save money and how to sometimes simply break even. While crunching numbers is incredibly important, it’s also important that you try not to do it on your own and instead hire an accountant.
Here are a few ways your accountant can help your business succeed.
- Ensure you are following accounting regulations both nationally and locally.
- Give insightful advice on how to better track your expenses daily, monthly and quarterly.
- Give advice on how to separate personal and business expenses.
- Review all employment documentation to make sure that freelancers and contractors are classified properly.
- Properly teach employees on how to read your financial statements.
- Monitor payroll procedures.
- Help provide advice on all tax payments.
- Determine who’s responsible for mailing out W2 and 1099s.
- Close out all financial statements, reports and assets by the end of the year.
- Make sure all IRS paperwork is submitted on time.
- Point out all areas of growth or decline within your business
- Help facilitate purchases inside or outside the business.
- Work with you on IRS auditing prevention.
- Be willing to stand by your business during audits.
- Help you budget for your business.
- Help financial forecasting.
- Provide business advice.
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Four Ways Your Accountant Should Be Using Math to Help Your Business
When people think about an accountant, one of the first things they think is that he or she must be good in math. While not every accountant is a superb mathematician, it is true that accountants do use math to assist their clients in various ways.
Math & Accounting
Here are four examples of how your accountant can use his or her math skills to help your business:
Production Costs
Before you can take your business to the next level, you must determine how much it will cost to actually run your business. These calculations are considered production costs. Hiring an accountant will help you determine not only what your pre-production costs will be but also how much it will cost your business to be sustainable for years to come.
Pricing
While most companies try to determine their pricing strategies alone, this is not recommended. It’s recommended that you hire someone specifically to help you with your pricing and that person could be an accountant. An accountant can work with you to determine how much you should price your goods and services in order to obtain a profit or to help you break even.
Profits
Profits are just as important as pricing, which is why it’s a skill that many accountants should have. They can work with you to both forecast future profits and also forecast your return on investments.
Analyzing Finances
In order to fully analyze how your business is doing, your accountant should be using math to help you determine your revenue and expenses. It is vitally important that you keep your records up to date in order to ensure that you are staying on top of sales increases and decreases.
In what other ways do you expect your accountant to use math? Leave your comments below!
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Five Pitfalls You Need to Avoid During Tax Season
Pitfalls of Tax Season
Tax season is rough simply of its nature, and so the last thing most people need is any additional sources of headache during this time of the year. There are a number of pitfalls, unfortunately, which you need to work hard to avoid during tax season so that your stress level doesn’t go through the roof. Here are five things you want to avoid in order to make tax season as easy and painless as possible:
Writing Off Personal Expenses as Business Expenses
Writing off personal expenses as business expenses could be a slick way for individuals to save a little extra money during tax season; however, this sends a huge red flag to the IRS and could ultimately lead to you being audited by Uncle Sam.
IRS Form Errors
Not sure if you’re filling out your tax forms correctly? It’s important that you go the extra mile and be certain of the accuracy of your forms. If you’re not sure about an item on your IRS form, consult a CPA or a tax preparer so that he or she can help you navigate the tax process.
Not Reporting Cash Businesses
Cash businesses are often watched closely by the IRS. Cash businesses are often places like restaurants, car washes and hair salons. If you are reporting your business to the IRS, make sure you’re also tracking the cash you receive to ensure that you’re not underestimating your earnings each year.
Missing Tax Deadlines
Do you miss tax deadlines year after year? This may cause the IRS to wonder what you may have to hide year after year and could ultimately lead to you being audited by the IRS. Missing tax deadlines shows not only inconsistency but it also signals that perhaps you don’t know what you’re doing. Hiring a CPA could be what helps you stay on track with deadlines in the future.
Misclassifying Workers
Classifying your full-time workers as part-time or contract workers is a major “no,” especially when dealing with the IRS. By misclassifying workers you may not only be putting your employees at risk for being audited but also your business which could ultimately lead to major repercussions.
What tax season pitfalls have you seen or heard of? Leave your comments below.
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Three Questions to Help You Decide between a CPA or Tax Return Preparer
Tax Return Preparer vs. CPA
Every year, many business owners struggle to properly answer the same recurring question: should I hire a CPA or a tax return preparer? The best answer to that question is that it really depends on a variety of things, and sometimes resolving this dependence requires a bit of mental horsepower.
Here are three questions you should ask when you determine if you should hire a CPA or a Tax Return Preparer:
How Much Time Do You Have?
If you don’t have a ton of time to waste, your best bet is probably to hire a tax return preparer. In most cases, these people can be found at your local library, helping you file your taxes for free (or prepaid with your tax dollars; however, you choose to view it). If you aren’t short on time and really feel as if you need to have your finances audited while having your taxes filed, a CPA may be better for you.
How Much Money Do You Want To Spend?
Because there are so many free ways in which you can get a tax return preparer, whether or not you decide to use a return preparer or a CPA depends solely on how much money you wish to spend. If you wish to save your dollars, then hiring a return preparer is best. If you don’t mind paying the hourly rate or retainer to guarantee that your taxes are done correctly, then hire a CPA.
How Much Does Performance Matter to You?
If you want to feel secure that your taxes were done right, and also that you received the maximum number of tax benefits, consider hiring a CPA. While a tax return preparer is trained to do your taxes the right way, in many cases they are civilians working as volunteers with the IRS. CPAs are in some cases certified at a higher level to help with tax preparation.
Which do you prefer: CPA or tax return preparer? Leave your comments below.
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Three Tips You Can Always Use When Filing Taxes
Tips for Filing Taxes
Every single year the IRS releases new changes to their tax filing systems. Oftentimes the changes the IRS makes can come so swiftly that we can’t seem to keep up with the changes from year to year. While the changes can be frequent, there are still ways your company can be smarter about their taxes each here. Here are three tips you can always use when filing taxes:
Educate Yourself
One of the tips you should always be willing to implement when it comes to your taxes is making sure you always educate yourself. Educate yourself by reading books about filing taxes, taking time to attend seminars or even asking local tax professionals how certain tax laws work. Educating yourself is what will help you if you decide to file your own taxes and it can also help if you hire an accountant to do your taxes for you.
Track Expenses
Tracking your expenses is always something that you as a business owner or taxpayer should be doing. Tracking expenses not only helps you make sure you’re monitoring what is coming in and out of your bank account, but it’s also a great way to make sure that you’re getting all your tax write offs when filing season arrives.
Don’t Combine Personal and Business Taxes
Combining personal and business taxes could literally turn into a living nightmare. By combining personal and business taxes, not only are you putting yourself at risk of being audited, but you’re also putting yourself at risk for owing high amounts of money to the IRS. Best way to avoid this? Don’t combine the two.
What other tips do you believe are indispensable during tax time? Leave your comments below.
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Four Areas Which Could Use the Help of an Accountant
Accountants Can Assist Your Business
It’s 2017 and what are you doing? Are you still making excuses on why you still haven’t hired that accountant that you know you have so desperately needed for the last several years? Are you still talking to your employees about how you’re unable to afford an accountant and you will look at hiring one once you get some extra money? It’s time to dismiss all those excuses and hire an accountant.
Here are four areas of your business which could be significantly improved with the assistance of an accountant:
Business Planning
Business planning is critically important to the growth and success of any company. There are several things which business planning has to account for, including: market trends, the goals of the CEO, development and more. Because of this, there is no one more qualified to handle all of your business planning needs than your accountant. If you allow someone on your staff who is not qualified to handle your business planning, you could risk losing money or even opportunities to make money.
Investments
Investing can be a tricky topic, especially if you have no prior experience in the investment industry. Investing is mainly tricky because it requires so much knowledge, such as knowledge of stock market trends, knowing how much to invest, when to invest and when not to invest. This is where your accountant comes in. He or she can make sure you are investing the right amount and investing at the proper time.
Sales Revenue
Making sure you are selling the items for your business at the right price is essential. If you’re constantly analyzing internal and external factors of your business, and constantly feeling like you’re not making ends meet, it’s time to hire an accountant. An accountant can make sure your pricing structure is accurate for whatever you’re selling.
Compliance
Tax law can be confusing. It is expressed in difficult language and it is constantly evolving. If you want to make sure you are able to navigate through the applicable compliance rules, your accountant can help you. A properly trained accountant can help you decipher between laws regarding your taxes, investments, future planning and more.
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Why Your Business is Never Too Small to Hire an Accountant
Small Businesses Should Hire an Accountant
“I would love to hire an accountant but my business is too small,” is an excuse many business owners often use when asked why they have yet to hire an accountant for their company. The idea that small businesses shouldn’t hire an accountant may seem sensible at first, but in reality it’s not. In fact, hiring an accountant could actually prove to be a great step for businesses which are very small.
Here are two reasons why your business is never too small to hire an accountant:
You Want To Grow
Every business owner dreams of growing their business, and if you truly want to grow as a business owner you’ll want to hurry up and hire an accountant. Not only can an accountant help you see where you are financially, they can also help you reach those goals that you’re hoping to reach sooner rather than later.
You Want To Hire Talent
You have to prepare for the things you plan for even if it’s 5 or 10 years down the road. Hiring new talent is no different. Many accountants believe that many companies are forced to deal with unfortunate layoffs because they hire talent prematurely. If you want to make sure you don’t hire talent before you can afford them, your accountant can help you determine when and when not to hire new talent. Best part of all: you don’t have to worry about spending money on new employees that you may not really have in the bank.
What reasons have you heard business owners say they can’t hire an accountant? Leave your comments below.
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How to Find an Affordable CPA
Finding an Affordable CPA
Finding an affordable CPA isn’t always easy, but there are ways to find an affordable CPA who benefits your business and also saves your bank account from being brought to ruins. Here are just a few tips to finding a capable and affordable CPA:
Referrals
Ask your friends, family and other business associates which CPAs they have hired in the past. Asking for referrals is one of the best ways you can make certain that you are getting what you are paying for because you have someone who has a working knowledge of the person you are looking to hire.
Barter
Do you have a service you can offer a CPA? Perhaps you are a marketing professional or a salesperson. Whatever the case may be, consider bartering your services with your CPA to help lower the price of the services your CPA will charge.
AICPA
The AICPA (which stands for American Institute of CPAs) has a list of resources available on its website which can help you identify the best CPAs in your area. This organization is actually the world’s largest association representing the accounting profession and is a great place to start if you can’t rely on referrals or bartering.
Local Library
Believe it or not, your local library is full of resources which are designed to help people find services needed by their company. Some local libraries even have areas where they connect businesses with CPAs and other service providers who are able to provide pro bono services to small businesses or low-income families.
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How to Hire the Right Tax Accountant for You
Hiring the right accountant for your tax needs may be necessary, but isn’t the easiest job in the world. In fact, hiring someone that you not only trust, but that you trust to execute the filing of your taxes correctly can be a very stressful process. Here are just a few questions to ask when hiring a tax accountant:
Hiring the Right Tax Accountant
What’s Your Experience with the IRS?
While being certified by the IRS is not a necessity, it can play a pivotal role in your tax filing, especially in cases in which you need an extension on certain deadlines. What’s more, some accountants may have bad reputations with the IRS for falsifying information, and these accountants might be more likely to put your taxes in danger of being audited.
Are You an Aggressive Accountant?
When it comes to tax accounting, you want to make sure you hire someone who is aggressive and knows all the tips and tricks about what items to write off and what items to deduct. A passive accountant won’t always look for the best tax breaks for you, but an aggressive accountant can identify legitimate tax breaks to help ensure that you are taking full advantage of the tax opportunities available to you.
What Types of Clients Do You Generally Work With?
Knowing what types of clients are in your tax accountant’s portfolio can let you know from the beginning if he or she is equipped to work with you and your business. While an accountant does not necessarily need to have experience in your industry, having previous knowledge does make things a bit easier.
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