5 Ways a Business Accountant Saves You Time and MoneyPosted on February 22nd, 2019
As a small business owner, you have to be careful about budgeting your money so that you have the capital your business needs to grow. When you’re used to handling the business on your own, it may seem like outsourcing your accounting is an unnecessary expense.
What most business owners don’t realize is that a professional accountant can save them both money and time, making it a significantly worthwhile investment regardless of the size of your business. A professional accountant can be an invaluable tool, and free you up to concentrate on the more creative aspects of your business.
If you’ve never created a bookkeeping system, the chances are good that you’ve had to learn as you go. While you can pick up a lot about bookkeeping while running a business, inexperience can also leave you open to mistakes that you won’t catch until it ends up costing you money.
A business accountant can help you organize your books, optimize your filing, and create time-saving accounting strategies you can use in your day-to-day business. They’ll also generate reports for you and help you keep your accounting up-to-date, so you have a better understanding of how much capital you have on hand.
One of the biggest mistakes small businesses make is failing to plan for fluctuations in cash flow. Several factors can affect how much money you make at different times of the year; anticipating and planning for these variations will ensure you continue to thrive, even during slow seasons and unexpected events.
Accountants can examine your cash flow and help you identify patterns to create a forecast of future earnings. This will allow you to anticipate when you’ll have the most resources to make large purchases and upgrades effectively.
Tax Planning & Preparation
A huge advantage of a professional accountant is their knowledge of tax laws and regulations. Not only can they save you time in filing, but they can help you predict how new laws and regulations will affect you in the next tax season. They can work with you to devise strategies that help you lower liability and take advantage of potential deductions.
A working budget is essential to a functioning business, but many owners have difficulty building consistency and diligence in this area. A professional accountant can help you to craft a working budget that allows you to allocate funds where they’re needed, while still keeping cash available for unexpected events. A budget is also ultimately important for getting your business to function without eating into your profit margins.
With all the responsibilities you have to manage, it can be easy to overlook processes and procedures your business may have outgrown, which could be blocking your path to success. An accountant provides a second pair of eyes and can help you identify weak points and streamline your business operations.
Siegerman & Company works with businesses across South Florida to help them function at their peak and breakthrough profit thresholds. For experienced accounting services, contact our office today.
IRS Mileage Rate 2019Posted on December 14th, 2018
The optional standard mileage rate for 2019 is 58 cents per mile.
Sales Tax 2019Posted on December 11th, 2018
Sales tax rates in many Florida counties are going up January, 2019. The new Broward County rate is 7%, Martin 6.50%, and Hillsborough 8.50%.
If in Broward and Martin County for example, this will change the way you report your sales.
Please contact us for further information at email@example.com , or (561) 232-2080.
New Sales Tax for Out Of State SalesPosted on December 10th, 2018
In June of 2018 the Supreme Court ruled that a state can collect sales tax even when the company does not have a physical presence in that state. South Dakota successfully sued Wayfair arguing that since the residents of South Dakota made purchases from Wayfair that an “economic nexus” exists.
This means states can pass laws to collect sales tax from purchases in their state from a company located in another state. For example, if my company is in Florida and I sell over the internet a product to a person in Georgia, Georgia may have the right to collect sales tax. In such a case the Florida company would need to collect, remit and report these sales on a regular basis.
This sound like a lot of work and expense for the Florida company. Maybe. Today 35 states have laws regarding these sales. In many cases there are exceptions for low volume sales.
To learn more, contact us at firstname.lastname@example.org, or (561) 532-2080.
Which Business Entity is Right for Me?Posted on November 30th, 2018
- Now that you’ve decided to start your business, one of the first questions you’ll need to answer is what kind of business entity you’ll choose for your new company. A surface glance might indicate that one type fits your business, but many startups have discovered too late that their chosen business type held them back.Before you commit yourself to something that seems right in the moment, take the time to learn a little more about entity types, so you can kick off your business with full confidence and avoid a costly relaunch.
What to Look for in an Entity Type
When choosing an entity type, before you even look at the choices, you’ll need to answer some particular questions. Your business entity will drastically affect what you can do regarding stock, branching out, and your tax and legal liability. You’ll need a solid plan in place, so you know the most effective way to proceed as your business grows, then find the entity type that fits into your strategy.
Make sure you ask yourself the following questions:
- Is this business nonprofit, or for profit?
- Am I the sole owner, or do I have partners?
- If a partnership, are all partners active in the company, or only one?
- Do I plan to offer stock in the company?
- If yes, how many owners do I plan to have?
- Am I concerned about personal liability?
- Am I concerned about double taxation?
These questions may not cover everything, but will at least give you a baseline and help rule out some entity types that may not be for you.
Common Entity Types
In the United States, the most common type of entity is a C Corporation, but it is only one of several choices and not right for all businesses. Other common business types include:
- Sole Proprietorship: For companies with a single owner. The owner receives all profits but is also responsible for all debts.
- General Partnership: Multiple partners own and actively participate in the business. All benefits and liabilities are shared.
- Limited Partnership: Multiple partners own the business, but only the general partner manages it and faces full liability for it. Also called a “silent partnership.”
- Limited Liability Company: Allows owners, partners, and shareholders to enjoy partnership benefits while limiting their liability.
- C Corporation: Allows an unlimited number of shareholders and no personal liability, but faces double taxation if profits are distributed to shareholders through dividends.
- S Corporation: This corporation avoids federal taxes, but the shareholders are taxed on their share of the income. The company can only have a maximum of 100 shareholders, and only certain people or groups can invest.
Consult with a Professional
Deciding which entity can be complicated, so if you have questions about entity types, the best thing to do is contact a professional accounting advisor. Many professional accountants offer business formation services and can examine the details and goals for your business to determine which business type will protect your assets and give your business room to grow and expand.
Siegerman & Company offers business formation services to startups in South Florida. If you’d like more information, contact us for a complimentary consultation today.
2017 FICA LimitPosted on October 19th, 2016
The 2017 FICA limit will be $127,200. Wages up to this amount are subject to FICA tax. The current FICA limit is $117,000.
For 2016 tax returns: health InsurancePosted on October 14th, 2016
For 2016 individual tax returns (filed in 2017) the box must be checked if the taxpayer had health insurance for the entire year. Otherwise, the taxpayer must indicate if they had an exemption, or pay the penalty. By merely ignoring the health care question, the return will rejected by the IRS next filing season.
2017 Tax InformationPosted on September 20th, 2016
Standard Deduction: $6,350 single, $12,700 married filing joint, $9,350 head of household.
Personal Exemptions: $4,050.
Gift Tax exemption: $14,000 a person.
Estate Tax Exemption: $5,490,000 (federal only).
IRA contribution limit: $5,500 and $6,500 (age 50 and over).
Keep in mind there are certain phase out limits for the Standard Deduction and Personal Exemptions. Please call our office at (954) 7965-4050 for additional information.
Remember to take Required Minimum Distributions (RMD)Posted on September 19th, 2016
Generally, Required Minimum Distributions (RMD) must be taken by those over age 70 ½ annually from employer pension plans and IRA’s (not Roth IRA’s). Failure to do so may result in a 50% penalty of the amount of the RMD. Keep in mind the year you turn 70 ½ you can defer the first distribution until April 1st of the following year. If so, you will have to take two RMD’s that year.
Legal marijuana not so legal in tax courtPosted on September 17th, 2016
Marijuana is legal in certain states. So if you own a marijuana dispensary it is a logical assumption you can deduct your operating costs? Currently, the answer is no. The Internal Revenue Code (Section 280E) essentially says no deduction for operating costs can be deducted in any business that traffics controlled substances. Since marijuana is illegal federally, you can only deduct cost of sales, but NOT operating expenses. There are several court cases pending on this matter. Stay tuned.