business woman reviewing business tax changes

What Are the 2019 Business Tax Changes?

2019 Business Tax Changes

Owning a business can be a challenging undertaking especially with business tax changes. While you may be happy to no longer work for someone else, you now have a lot more on your plate as a business owner. You’re responsible for various aspects such as business taxes. If you’re not in compliance with your company’s tax payments and filings, then you could face legal trouble.

Now that 2020 is here, you may be concerned about new tax laws that will affect your business. As you start thinking about filing your 2019 tax return, here are some changes to keep in mind.

Lower Tax Rates

Here’s great news for small businesses concerned about business tax changes. In the past, the tax rate for pass-through entities such as sole proprietorships, partnerships, S-corporations and limited liability companies was the same as your individual tax rate. Now, you get a 20% tax deduction, as long as you’re an individual who earned less than $157,500. For joint filers, the maximum is $315,000. Service providers have to be careful, though. Doctors, lawyers, financial advisors, and others in the service field may not be able to take the deduction if their income is too high.

Higher Bonus Depreciation

For companies that buy large amounts of equipment, the bonus depreciation is a huge area for tax deductions. This area has changed regularly, and new tax reform has updated this once again for 2019. 

In the past, a company could take a huge percentage upfront, and then apply the rest in smaller percentages over the next several years. First-year bonus depreciation is now set at 100%, so if you want the entire deduction this year, then go for it. Just know you won’t receive anything for the same item next year

Under IRS law, equipment, machinery, appliances, computers, and furniture generally qualify for bonus depreciation. The item can be new or used, as long as it meets all the other requirements set forth in the law. 

CPA working on Business tax changes

No More Entertainment Expenses

Sadly, small business owners will no longer be able to deduct entertainment expenses. Sports tickets and golf outings have been removed for all business entities. While these are big-ticket items, even smaller things like meal expenses can no longer be claimed on tax returns. The law no longer allows deductions for membership dues to social or recreation clubs or tickets or admission to activities considered entertainment or recreation. This can be a huge setback to companies that rely a lot on entertaining clients to secure business deals. 

Learn More About Business Tax Changes

Laws are constantly changing. If you’re a business owner, make sure you understand what your business needs to do to stay in compliance. Ash Wasilidas, CPA Firm offers accounting and bookkeeping services to individuals as well as nonprofit and for-profit organizations. You can trust owner Ash Wasilidas to manage all of your CPA and accounting needs. To learn more about business tax changes, call (617) 462-6651 or fill out the online form.  New clients are always welcome.

What is Section 179?

Section 179

Tax time can be a huge headache for many people, and that problem only intensifies when you’re a business owner. Various laws apply, and they can differ depending on the type of business you own.

One confusing tax topic is Section 179. Many business owners find it complicated and choose to simply skip over this section. While it can be confusing, knowledge is power. By not taking the time to learn more about this tax deduction, you could be losing out on thousands of dollars in deductions every year. With tax season quickly approaching, here are some things you should know about Section 179 when you file your tax return for 2019. 

How Does Section 179 Work?

Essentially, Section 179 allows business owners to deduct high-ticket equipment and other items they purchased or financed during the tax year. For tax purposes, you will use IRS Form 4562. If you use TurboTax or some other tax software, it will walk you through the process.

The amount you receive is based on the depreciation of the item over time. Qualifying purchases include vehicles, machinery, and property. Large purchases such as computers, appliances, and furniture can also be deducted, as long as it is considered tangible, depreciable property that you used for business purposes. 

tax expert | section 179

If you own a construction company and you bought a tractor for company use, you would be able to deduct the entire cost through Section 179. If your gross income was $100,000 and the tractor cost $50,000, you would be able to deduct $50,000 from your income. The government allows you to do this because they want to encourage you to make purchases that will further your business.

Keep in mind that you must also use the property the same year you buy it. If you bought a computer in 2019 and it’s still sitting in the box in April 2020, you cannot claim it. 

In the past, you could claim only 50% of the purchase price in the first year, and then claim smaller percentages in subsequent years. This is no longer the case. You can now take the full 100% deduction in the first year.

Many businesses once used this deduction to write off vehicle purchases, such as SUVs and sports cars. However, deduction amounts for these purchases have decreased in the past few years.

There are some limits to 2019. You can deduct up to 100% of the cost of the equipment. You can spend up to $2.5 million on equipment, but you can claim only $1 million, which should be more than enough for most small businesses. 

Contact Us

If you own a business, make sure you take advantage of all the tax deductions available to you. Section 179 is one of them. Don’t overlook this important tax deduction. Count on Ash Wasilidas, CPA Firm to get your tax returns done accurately. He has experience working with all sorts of clients, from businesses to individuals. To learn more, call (617) 462-6651 or fill out the online form

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Bookkeepers, Accountants, and CPAs: Defining the Role

CPAs Framingham MA

You will often hear of accountants, CPAs, and bookkeepers used interchangeably. However, that does not mean that they are the same, and their scope of work is quite different. Taking a closer look, you will learn that their licensing, professional status, and task performance from each are completely different. 

They all work with businesses and have almost similar functionalities in the business as they all handle financial data.  Some businesses, however, choose to employ the three people and give them different roles to monitor the company’s economic growth. However, there are those who are unsure of the difference hire either of the three professions and expect to receive particular services from the person. If you are unsure of what terms to use and what they mean, here is a brief overview of each word and its standing with internal revenue service.

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Bookkeepers

A bookkeeper is a person who puts financial books of an organization. The person can either be an employee or work as a contractor in the company. Bookkeepers are, however, responsible over recording organizational transactions, including inventory, accounts receivable, accounts payable, provide monthly, quarterly, and annual reports, and payroll. However, as a bookkeeper, you must ensure that all the information provided is accurate and precise. Most bookkeepers today use the same software like QuickBooks, which are often used in accounting.

With a bookkeeper, you are sure that you will not have to deal with any business payment. The bookkeeper guarantees to take care of any transactions, including keeping track of what you owe in your credit cards. You can also depend on the person when it comes to monitoring and tracking business growth as they can provide you with sales monthly reports. The bookkeeper can also be your person when it comes to paying sales taxes as well as filling form 1099s and 1096 every end of the year. However, unlike when working with an accountant, the bookkeeper will never share any tax advice or analyze any reports for you.

Accountants

On the other hand, accountants operate at a higher level compared to the bookkeepers. Accountants can perform the duties of bookkeepers, although they usually don’t do the same. However, they can perform audits on the books, especially in public companies, prepare financial statements, and can also prepare reports for tax purposes.

Accountants are often classified by the IRS as an unenrolled preparer. Therefore, they are not regally authorized to represent clients, during audits, singing tax returns, and other matters before IRS. This is a duty that is only left strictly for tax attorneys, CPA, and enrolled agents.

CPAs (Certified Public Accountants)

CPAs are basically an accountant that is licensed to operate at a particular state. They are often certified after going through a particular examination in the respective state and meet specified requirements for licensing in that state. This level of credibility is what makes CPAs different from regular accountants or bookkeepers. 

Their central role is to prepare and review financial statements ion an organization. However, on top of that, they also help in making tax returns for individuals and businesses, represent taxpayers before IRS, sign tax returns, and other matters. 

Which Professional Do You Need?

Whether you have a small business or your organization is significant, the need for a person to take care of your financial books is critical. You can choose to hire an employee or involve the services of a contractor to work as a bookkeeper. However, it is essential to ensure that the bookkeeper works for an accountant or a CPA. 

Additionally, you will need someone to help review your financial reports and make decisions on taxes and finances. Although I cannot advise you to get a CPA, it is essential to keep in mind that an accountant who is not certified or licensed to practice CPA cannot represent you in the presence of the IRS. This is an essential distinction to most businesses and the main reason as to why they invest in hiring a CPA to give tax advice and review financial books. They also help in preparing and submitting tax returns for both the company and individuals online, hence making it easy for the business owner. 

Conclusion

Matters regarding finances are critical for any business development. If you make the wrong decisions while hiring people who handle finances, your business growth will automatically get at risk. Therefore, it is essential for you to perform thorough research and evaluate the type of person you want in your organization. 

Also, once you hire a CPA, allow them to execute their services in your favor without restricting their performance. This will guarantee that they will work as hard to ensure you are on the right side with the IRS even when all odds are working against you.

Learn More

Ash CPA offers bookkeeping and accounting. Learn more about our services with a consultation today. Call Ash CPA at (617) 462-6651 or book an appointment online.

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What is a CPA? (Certified Public Accountant)

CPA Framingham MA

Whether you own a small business or are just thinking about starting one, you may be thinking about getting a CPA, certified public accountant. You can do the day-to-day accounting on your own. But as you grow, you may want to use more advanced accounting software. 

This is when a CPA is beneficial. CPAs or certified public accountants are essential for growing businesses. Not only can they assist you with taxes, but they also offer in-depth financial knowledge for your particular industry. Learn more about CPAs below and contact Ash CPA today!

Education

A CPA must undergo several educational requirements. For instance, a student is required to complete 150 credits per semester in order to qualify to sit for the final examination. CPAs also need to maintain their knowledge with continuing education courses, staying current on tax laws and industry market trends.

You may not have to hire a full-time CPA professional, but you can still benefit from their knowledge. Here are four occasions when you need to hire a CPA professional.

CPA reading reports | CPA framingham ma

Before You Start the Business

When you are starting the business, you probably have a tight budget to stick to and do not like the idea of spending on CPA. It may sound extravagant, but it is a step worth taking. Plus, it is a deductible expense.  The professional can help you set up the business correctly and avoid any mistakes. You do not want to make any mistakes that will cost you in the long run. As a business owner, it is normal not to feel like you need anyone’s help with the decisions, but professional advice could never hurt. 

A professional can recommend the best business structure for your target demographic and business type. This means the partnership, sole proprietorship, and corporation. These are factors in your business that could affect reporting requirements, taxes, and liability. They may also be more difficult to change later on, which may mean reapplying for the license later. 

A professional will also make it easier for you to determine whether an accrual or cash accounting is perfect for you. When you start your company, you need to ensure that you know which accounting software is right for you. Most new businesses will need to determine which the best accounting type to use is. With the accrual method, you will have to record the expenses and income over a period of time rather than doing it immediately you receive the money. 

During The Tax Season

CPAs will prepare the tax documents, provide tax planning, and file tax returns that will allow you to get the advice you need to maximize your liability for the next year. They will also represent you to the IRS if there are questions about your returns or you are getting audited. Business taxes are not similar to personal taxes, so you may never be able to do them on your own. 

That is why you need a professional to help. If you sell your products to customers in different states, you can save time by letting a professional deal with the taxes for you. They are also in a better position to understand the deductions that you qualify for. The last thing you need is to trigger an audit. 

Expert Accounting Advice

Sometimes during the life of your business, there may be times when you require an expert. A great example if when you get a letter that you are getting audited. Then, you will need to hire a CPA expert who will represent you. These professionals have enough experience to help you respond appropriately and supply the information needed to resolve the problem painlessly. 

The professionals will also help you when you are thinking of taking a business loan. They will give you the chance to decide what fits your business. In addition, they will speak with you about the best type of business loan and help you figure out the perfect size loan that will allow your business to grow without the payments impacting your cash flow.

Learn More

Learn how a CPA can help grow your business today! Schedule a consultation with Ash CPA by calling  (617) 462-6651 or booking an appointment online. Our team has over 20 years of experience. Additionally, we offer a variety of services including accounting, bookkeeping, tax audit representation, and consultation.

Why Entrepreneurs Need Consultants

Consultants Framingham MA

Consultants offer ideas and opportunities to create value in a product or service. For example, if your business sells bagels, how can you show your audience that your bagels are better than the competition? How can you show them that your service is one-of-a-kind? In other words, why buy from you? Every industry is different and faces varying obstacles. For this reason, entrepreneurs need consultants. Learn about their valuable roles below and contact us today.

Management and Strategy

Experienced consultants are knowledgable of particular markets and know the best practices of the industry. For instance, business consultants are great for helping businesses expand. They are likely to help with increasing your product collection and restructuring your middle-market company to produce cost-effectiveness and efficiency. They may even suggest buying out a smaller competitor and seeking the services of experienced managers that can assist with the new locations.

Consultants Framingham MA

Operations

An operations consultant can help you create and implement an innovative way to expand successfully. In addition, other consultants are experts in quality control systems and can help you to make the necessary changes that will reduce the defects.

Information Technology 

Information technology or IT consultant will help you develop a new system and also merge your old system so that they can work together. IT consultants enhance your capabilities and also make your IT more reliable in meeting the expansive needs of internal and external clients.

Human Resource

Human resource companies will specialize in inventing compensation strategies that will align with your overall business goals, training, communication, and leadership. Additionally, human resource consultants help improve employee performance by evaluating your team and offering suggestions. Turn-over rates will decrease while productivity and employee satisfaction increase.

Marketing

Marketing consultants offer a creative spark to attracting new business. They can also help with marketing you to potential new partners and investors.

Benefits of Hiring Consultants

New Ideas

If you do not have the human personnel you need some because you will need some that can make some decisions for you. Hiring a business consultant for a project or temporarily can fill the gap until the right person is found.

Create Evolution

Consultants are skilled at harboring change in an organization. Such changes assist the organization with evolution. Businesses need to evolve in order to stay relevant with their ever-changing market. Without evolution, it is likely that a business will depreciate and suffer losses.

Implementing Best Practices

Consultants are experts within their specified industries. They are consistently seeking new information, trends, and technology of the market. This research is continuous and requires a lot of time. As a business owner, you may be juggling with a lot of responsibilities. For this reason, consultants are a great asset because they provide knowledge and time to perfect your business.

Learn More

Ash CPA offers more than bookkeeping and accounting services. In fact, we have over 25 years of experience in building and growing businesses. Learn how your idea or established business can grow! Book a complimentary consultation today. Call  (617) 462-6651 or book an appointment online.

 

Business Consultant Framingham MA

What is a Business Consultant?

Business Consultant Framingham MA

Business consultants are skilled professionals that provide management and operational consulting to organizations. They are also experts within particular industries and markets. In other words, business consultants conduct hours or research and networking to assure they know the latest trends and solution techniques.  Consultants evaluate businesses and recommend solutions that are cost-effective and productive. Oftentimes, business owners seek a consultant to help restructure the business or expand seamlessly. Learn more about these industry leaders below and contact us today.

Business Consultant Responsibilities

A  consultant has various responsibilities which include the following.

  • Identify liabilities
  • Provide objectivity
  • Restructure the organization
  • Create a new business
  • Influence other people such as lobbyists
  • Implement change to the organization
  • Evaluate the team’s dynamic
  • Train employees

Discovery Phase

The initial step for the business consultant is the discovery phase, where the objective is to learn the clients’ business. A good consultant will take time to know much about the company from the owner to the employees of the business. This will include visiting the facility, meeting with the employees as well as the board of directors, evaluating the finances, and knowing all the company objectives.  During this process, the consultant will learn the details of the company’s mission and what type of operations that are in place.

Business Consultant Framingham MA

Evaluation Phase

Once the consultant has enough knowledge of the business, they have entered the evaluation phase. Here, the goal is to identify where the change is required in the company. This will include identifying the company’s strengths and weaknesses, the current and note able problems. This may consist of the issues that are already outlined by ownership and management. The new problems will be able to be seen by the objectives of the business consultant. A business consultant should also find new ways of growing the business, increase efficiency and also increase the company’s profits.

The business consultant also needs to find solutions to the various issues and plans on how to capitalize on multiple opportunities. During this phase, the consultant and the company’s employees need to maintain open and transparent communications.

Implementation Phase

The owner and consultant combine their ideas and create a plan that improves the business. When the two parties have agreed on a plan, the consultant should enter the third step of consulting, which is the reconstructing stage or the implementation of the program. In this stage, the consultant will build on assets and eliminate liabilities. In addition, they monitor progress and adjust the plan as needed. 

Learn More

The consultant should have a passion for their work, a motivation for excellence, and an eye for organization and detail. Additionally, you need a consultant with knowledge of your industry for the best results. 

Fortunately, Ash CPA offers business consulting with over 25 years of experience. Learn more with a complimentary consultation today. Call  (617) 462-6651 or book an appointment online. Moreover, we proudly serve Framingham MA and surrounding towns.

Missed Tax Returns? File Today

Missed Tax Returns Framingham MA

It is not difficult to fall behind on filing your taxes. This may happen due to several reasons, such as; 

  • Inability to afford any tax services.
  • You could forget about the filing tax deadline.
  • You may also have suffered a severe disease that left you incapacitated and hence unable to file your tax return. 

Most people are tempted to stop filing their tax returns and ignore any severe actions. However, this gets completely serious when the IRS starts sending you reminders of your unfilled tax or debt you have not paid. The IRS has a powerful ability to take stern action against you for failure to file. Therefore, it is essential to know the possible repercussions for failure to pay. 

Failure to pay is a crime

When you fail to file your tax returns, there are chances that you will get into serious trouble. The IRS considers this a crime and assumes you are intentionally evading the liability. They usually assess the debt on your behalf. The resulting consequences may mean a jail term for not filing your tax returns or fines or hefty fines amounting to up to $250,000. 

missed tax returns

The IRS can file a substitute return for you

This, however, is not a courtesy return for those who fail to submit their gains. Therefore, it does not include any deductions or exemptions. The IRS files a Substitute return, in place of the missed returns, when they notice the failure to do so. Filled SFRs may reflect a tax liability owed by the taxpayer. After that, the IRS sends out a detailed collection notice showing that an SFR was filed. They will seek to know if there exists a tax balance that is associated with the SFR.

No timeline for IRS action

The IRS has no time limit within which they can enforce their collection action When they asses the balance that is due for collection from you. When IRS analyzes and finds a balance against your account, they can take your wages; charge the bank accounts, where the need arises, they place notices on your physical assets. Do not let time pass by, regardless of time-lapse IRS never loses track of the debt. It gives them more right to ask for the accumulated amount.

Benefits of filing your missing tax return

When the IRS takes collection procedures against you it is not easy; therefore, you should submit your tax return. Although you are not bound by a time limit to file returns for any past tax years, the IRS limits receiving refunds for previous tax returns. The IRS allows you collection on a tax refund for up to three years from your returns the due date.

Filing the tax returns is not one of the exciting things to do. Some people even dread the activity every year. Regardless of your feelings about filing your returns, always remember it is a requirement. You also need to remain compliant and out of the collections list with the IRS. When you have unfiled tax years, consider it beneficial to speak to a tax attorney or any tax resolution organization. These enable you to resolve all outstanding debts, that you may have for all the unfiled years or all the tax debt assessed on you after the IRS filed an SFR. 

Learn More

Contact Ash CPA to learn more about filing missed tax returns. Call (617) 462-6651 or book an appointment online.

tax issues framingham ma

Tax Issues: Avoid Tax Liens Today

Tax Issues Framingham MA

A tax lien is a hold that the IRS places on your assets to ensure that you pay your debt. This, however, should not be confused with a tax levy. The sole purpose, the IRS places a tax lien is to attempt to ensure that it receives the payment due for the unpaid taxes you owe.

There exist five ways by which taxpayers can likely avoid IRS placing a tax lien on them.  

Pay the Taxes You Owe in Full

Stop an IRS lien on its tracks by paying the taxes you owe in full. If you can afford to do this, the tax lien will not apply. When you want to make the payment IRS makes it possible for you to pay directly from your bank account, using your credit card, or through a third-party processing service. You can also use the Electronic Federal Tax Payment System (EFTPS) to make a safe electronic payment. You may also choose to go on a low-tech route and mail a check, money order, or personally deliver your amount to the local IRS office.

Enter into a Guaranteed Installment Agreement

If you owe less than $10,000, and cannot pay the entire tax debt in full, you can still avoid a tax lien, by making a plan for the Guaranteed Installment Plan. In this plan, you can set to remit your entire balance to IRS through monthly installment payments. The size of the monthly payout and the length of repayment will vary according to the size of your debt.

tax issues framingham ma

Streamlined Installment Plan

This method is applicable if you owe a sum ranging from $10,000 to $25,000 in unpaid debt of taxes. You can still avoid a tax lien from the IRS, by entering into a Streamlined Instalment agreement plan. The plan works in the same way as a Guaranteed Instalment Plan. The result is the same, and you eventually pay the entire debt that you owed in federal income taxes.

Reduce Your Balance

This method applies when you owe more than $25,000 in back taxes to the IRS. You, therefore, must reduce your debt balance to less than $25,000 to keep away from a federal tax lien. The payment has to be before the lien gets imposed on you. There is a relief when your unpaid tax balance goes below $25,000, and you are safe to enter into a Streamlined Instalment Agreement.

File for an Offer in Compromise

There are times you can only afford to pay back only a portion of the federal taxes you owe. You could still avoid a tax lien by going to file an Offer in Compromise. When accepted, the Compromise enables you to resolve your tax responsibility with the IRS for an amount less than the sum of federal taxes due. However, the IRS is strict about tolerating Offers in Compromise. The procedure to review Offer in Compromise applications is lengthy. There is also no assurance the IRS will not inflict a tax lien while you are waiting for the decision on your Offer in Compromise plea.

Resolve Your Tax Issues

Ash CPA offers assistance with tax issues for individuals and entities. Learn more by scheduling a consultation. Call (617) 462-6651 or book an appointment online.

framingham bookkeeper

Defining the Role of a Bookkeeper

Framingham Bookkeeper

Whether you sell electronics, pet food., medical services, or investment advice, your business earns and spends money. A bookkeeper helps you keep records of all business transactions. This guide assists you to understand the specific roles of a bookkeeper and why you need to have a good one. 

A bookkeeper is a finance professional who prepares, documents and stores all daily financial transactions. Traditionally, bookkeepers used volumes of files to store receipts, invoices, and bills. Today, the modern ones use software to efficiently track income and expenditure. 

framingham bookkeeper

Bookkeepers vs Accountants 

While bookkeepers are professionals in financial matters, there are some financial tasks that they cannot perform. They may keep daily transactions, but that is pretty much the end of their jobs. Enter accountants. These are advanced analysts who use the data compiled by bookkeepers to generate financial models. 

It is safe to say that bookkeeping is concise and transactional. On the other hand, accounting can be subjective and therefore needs skilled interpretation of data and trends to make logical business conclusions and decisions. 

So what does a bookkeeper’s day look like?

Every day, a bookkeeper will do some data entry and receipt taking. Their jobs revolve around labeling expenses while indicating how much money was paid for goods and services. At a doctor’s office, for example, a bookkeeper tracks incoming payments from patients and issues invoices to demand payments. 

Having said that, bookkeepers do more than just enter numbers in Excel. They make careful entries to ensure that numbers tally. When auditors come knocking at your medical practice, these professionals make sure records are updated and that your business pays taxes properly. 

 

Let us understand the roles further. Any bookkeeper will handle the following 4 main financial statements. 

Income statement – this document indicates the expenses as compared to the revenue of your medical clinic. It is also referred to as a Profit and Loss Statement.

Balance sheet – this is a quick overview of the financial position of your business at a point in time. 

Cash Flow statement – this statement is a record of the cash and equivalents of cash that enters and leaves your accounts.

Changes in Equity Statement – this statement is also known as Statement of overall recognized losses and gains. It indicates how your clinic’s reserves, share capital, and earnings have taken shape over a certain reporting period. 

The following are other financial tasks that your bookkeeper does on a day-to-day basis. 

  • Keep and observe your company’s fixed assets
  • Collect and submit taxes to the government 
  • Pay any contractor or supplier invoices
  • Check levels of debt and make payments that are due
  • Make records of incoming cash while depositing it at the bank
  • Do accounts reconciliation every month
  • Give financial statements 
  • Provide accountants with accurate financial statements during tax seasons
  • Maintain the company’s annual budgets
  • Report on variance issues when they arise
  • Process and make employees payroll

Benefits of a Framingham Bookkeeper

Knowing where your money is coming from and where it is going is very important for your medical practice. Having a highly-skilled bookkeeper will bring this benefit plus many others as follows. 

  • Brings you peace of mind when books are updated
  • Ensures that tax season goes well as planned
  • Keeps detailed documentation to present to audit teams
  • Affords you more time during your day so you can focus on core areas of business
  • Helps you understand the logical flow of your medical clinic
  • Makes you comprehend the costs, revenue, profitability and other key metrics of business

Learn More

Ash CPA offers an array of bookkeeping and accounting services. Learn how a bookkeeper will benefit your business by scheduling a complimentary consultation. Call (617) 462-6651 or book an appointment online.

best bookkeeping framingham ma

Best Bookkeeping Practices for Small Businesses

Best Bookkeeping Practices

Successful business owners need to maintain their bookkeeping. Proper bookkeeping is an integral part of ensuring the business remains successful. Without it, you may not know how much profit you are gaining and how many expenses you incur. Plus, poor bookkeeping makes it difficult to accurately file taxes and can lead to business failure. Many small businesses prefer a professional bookkeeper, such as Ash CPA. Our firm is staffed with knowledgeable professionals and has over 20 years of experience. Nevertheless, if you decide to go at it alone, below are the best bookkeeping practices for small businesses.

Maintain Routine Inventory Audits

With regular inventory audits, you will be able to determine the exact amount of products. This is because some of the products may be missing due to theft by employees or vendors not delivering the correct amount of goods. Regular inventory audits will be able to highlight all the products that you have in your store. It will also enable you to keep the right amount of product in the store, creating more space for you in the process. Regular inventory audits will also allow you to analyze your sales and prevent overstocking of nonperforming products.

best bookkeeping framingham ma

Follow-Up on Your Invoices

Always follow-up on all of your invoices. Some clients are quick to make their payments, but others are not. The invoice could have been sent to an incorrect email or address. Other times, the client may not have read the invoice or marked it for payment. Therefore, keep track. Always follow-up on all the invoices sent, especially those that are over 30 days due.

Separate Business and Personal Expenses

You should not only keep track of your business expenses, but you should also have a separate account for the expenses incurred by the business. In addition to that, have a separate credit card for your business as this will significantly make it easier to file your taxes and be eligible for all business deductions.

Avoid Tax Penalties

By not paying the quarterly taxes on time, the government charges a penalty for all late remittances. You will pay more with the option of waiting till fall to remit your taxes as it will accrue penalties. All these can be avoided by saving a certain amount every month and paying the taxes quarterly. This will help you avoid evading or accumulating taxes while at the same time stabilizing your finances all year long.

Save Money

You may be faced with a situation where a piece of equipment that is vital to your business breaks down or requires repair or maintenance, yet you may not have the necessary funds to fix it. This may slow down business for you and lead to losses that could have been avoided if you saved some money for such situations. 

You may take a loan for such; however, setting some money aside will be more viable as it will come in handy without extra charges. Another workable solution is opening credit lines that can be used for operating expenses and act as an emergency fund source.

Create End-Of-Year Accounting Checklist

Having an end-of-year accounting checklist helps not only to prepare for taxes, but it is also critical to the long-term growth and success of the business. It will also give an insight into the business performance at the end of the year and will help you make more informed decisions to be more profitable in the coming year.

Contact Us

Ash CPA offers a wide range of solutions to help businesses of all sizes and dynamics succeed. Speak to us today to learn about the best bookkeeping practices. Call  (617) 462-6651 or book an appointment online. We proudly serve Framingham MA and surrounding towns.