Launching a new business can be both exciting and challenging. Your vision of the business is what energizes you, and that’s important. As Tony Hsieh, CEO of Zappos said, “Chase the vision, not the money; the money will end up following you.” That said, you can’t casually address the financial aspects of the business. Specifically, pay close attention to your start-up expenses and how they are treated relative to taxes. What Are Start-up Expenses and Why Are They Important?…
It can be challenging to get away on vacation when you own a business or you’re self-employed. That’s one reason why you may jump at the chance to travel when the trip offers both business and personal pursuits. If you plan to claim tax deductions for travel, it’s important to understand what does and doesn’t qualify as a legitimate write-off under Internal Revenue Service (IRS) law. Is the Trip Primarily for Business or Pleasure? If you’re planning a combination…
Business is ultimately about money. Said Idowu Koyenikan, author and international consultant, “Money is always eager and ready to work for anyone who is ready to employ it.” As a smart small business owner, you want to use your scarce capital wisely to grow your business. Alfred Marshall, British Economist, said aptly, “Capital is that part of wealth which is devoted to obtaining further wealth.” So, when you approach major financing decisions, what’s your pick, capital vs operating lease? …
Like most small business owners, the time will eventually come when you need to consider outsourced accounting services. While it can be challenging at first to give up some of your control, it can also bring a great sense of relief. When you choose to outsource accounting services, it frees up your time to focus on expanding both your business and your profit margin. We highlight eight other benefits you can expect from outsourcing. You Get Access to the…
Accounts payable is the term used to describe money that one business owes to another. Typically, these include vendors who have provided goods or services to your company and extended credit of 30, 60, or 90 days. Keeping up with these payments is essential to stay in good graces with your vendor as well as protect your ability to purchase on credit in the future. You will also end up paying more in late fees and interest, impeding your company’s…
Every business will experience a major change at some point. That means you and your partners should prepare for the likelihood of updating ownership shares and the way you split profits. We believe that every business should prepare for multiple scenarios when this type of change might be necessary. Below are four common situations we have seen with clients. You or a Partner Decides to Go Full-Time with the Business Maybe you started with the business part-time, splitting your…
You may have been able to keep up with everything when you first launched your small business, including bookkeeping and accounting paperwork. As your business grew, you just didn’t have the time to get to it quite as consistently. Now you have reached the point of considering outsourcing your accounting paperwork to a company like Doerhoff & Associates CPA. Regardless of what you ultimately decide regarding accounting functions for your business, it’s a good idea to have a basic understanding…
If you pay $600 or more to an independent contractor in a year or $10 in royalties to an individual, the Internal Revenue Service (IRS) requires that you send a MISC-1099 form. The form must be postmarked by January 31 to cover any miscellaneous income or royalties from the previous calendar year. Businesses typically issue MISC-1099 statements to individuals and sometimes partnerships. Other Situations that Require IRS Form 1099 Reporting In addition to royalties and money paid to independent contractors,…
A Chart of Accounts can help any business manage its finances, however, it’s only useful when organized properly. While it’s common for small business owners to tackle this organization project at the beginning of the year, the company can benefit from organized financial data regardless of what month it is. A review of what to include in a Chart of Accounts is helpful before we discuss organization tips. The Four Most Important Items to Include in a Chart of Accounts…
An unexpected tax refund can make it possible to invest in your company in ways you might not have been able to otherwise. However, creating and prioritizing a list of options can be challenging. We would like to help by offering 10 possible suggestions for how to spend your tax refund well. Ranking your list in order of importance is entirely up to you. Options for Spending Your Tax Refund While you will probably think of several of your own…
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