Blair Stover

When do you need an accountant most? It’s not during the holidays, or even during tax time, but during that time of year when we have to start considering our financial situation. When is that exactly? You guessed it – every single day.

Taxes (Photo credit: Tax Credits)

An accountant is someone you need year round. Taxes are a needed evil and no-one likes to deal with the massive sum of paperwork that often goes into submitting taxes. Nonetheless, generating a single modest mistake at any time during the year can cause quite significant penalties during tax time and this may be the reason why numerous men and women want the help of a knowledgeable accountant.

By far, however, the most common time people seek out accountants is during tax season. Accountants help you make certain that your taxes are performed appropriately and on time. Think about it, do you really possess the time to go over all your records and make sure that your taxes are properly done? Do you know all the legal guidelines relating to taxes? Accountants know the certain tax legal guidelines that all businesses and taxpayers ought to adhere to and also some deductions that you might qualify for.

In lots of circumstances, an accountant may also find ways to allow you to conserve your own taxes. There is a possibility that you’ll be able to qualify for an extra deduction or two and qualify for a refund. Given that taxes in many cases are extremely challenging, why do it yourself and offer up the chance of creating errors?

While an accountant’s help is particularly useful for business and personal finances year round, be sure to at least consider seeking out financial tax preparation help next April. You never know what an accountant will help you save.

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Starting a new business cannot be successfully done without addressing the accounting. The right accounting strategies can save a new business a lot of money as well as save on a lot of heartache later on.

For starters, a sole proprietorship is the simplest form of entity for a first business. With this business format, no special filings or communication with the IRS is required until you begin paying employees. Being the sole proprietor makes you the owner, or entity, which may require you to obtain an occupational license, depending on county.

Business owners are responsible for remitting all city or state collections for wholesale or retail sales. The majority of cross state sales and business which sell services are state tax collections exempt. If this liability concerns you personally, you can purchase a personal liability umbrella policy to protect yourself.

Tax (Photo credit: 401K)

Until your first tax return as sole proprietor is filed, the IRS will not need information from you. When the time does come to file, include a Schedule C, which will outline your sales and expenses communicated in your records. If your business fails, or changes ownership, you just cease doing business. Just file a final Schedule C with your personal taxes that year.

The appropriate way to provide yourself income from your proprietorship is to take your pay out as a draw. This keeps you from having to deal with the concerns of payroll taxes and quarterly forms.

After your business has passed the five year mark, it is worth meeting with a CPA to discuss a different entity type that could save you taxes. Transferring all existing business assets to this new entity can be done with a simple bookkeeping entry, which will save you any tax penalties.

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Tax day is fast approaching. As of March, only about half of the estimated 140+ million individual tax returns have been filed. This may be due to the increased number of taxpayers using e-filing, a process that allows one to have tax documents ready to go but not sent until close to the due date.

The good news is refund amounts are holding steady, rather than decreasing, with the average refund amounts remaining around $3,000. The bad news, however, is that wealthier tax payers may see more audits. If you are still working to meet that April deadline, make use of some last-minute tips from tax preparers, particularly if you’re in the upper income bracket.

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For most, though, doing taxes themselves is still the preferred method, and though the deadline is close, there are still some often-overlooked deductions you may want to be aware of. If you find that you owe alternative minimum tax (AMT) for this tax year, the state refunds are not taxable; as long as the amount is less than that of state tax disallowed under ATM. Also, charitable donations, Part I is often overlooked. Labor or time may not be deducted, but expenses like uniforms, mileage or the cost of treating underprivileged youth to events can be deducted. Other overlooked deductions include moving expenses, payroll charitable deductions, and medical expenses.

Additionally helpful is being aware of some audit triggers. Mortgage-interest deductions more than $50,000 are a trigger. Large charitable contributions prove audit triggers, especially if they are non-cash items. Business losses more than two year in a row (Schedule C) are an audit. A small profit shown here will only raise taxes a small amount while keeping attention of auditors away from your file. Also closely monitored are homebuyer tax credits and rental real estate losses.

Common errors in tax preparations include overstating charitable deductions, as some charitable events are only partially deductible. Mortgage points are also often deducted incorrectly. Small interest payments are often omitted. If you’re unsure what is deductable or how to fill out a return be sure you seek out tax filing help. The last thing you want is to start out 2012 with an audit because you felt rushed or were unsure how to fill out specific sections.

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With tax time upon us, you may begin to feel the pressure to get your paperwork in order. In order to start your tax preparation, you will need all of the necessary forms. Even if you have saved your receipts and have them filed and orderly, you may be held up if you have not yet received your W-2. Employers have until January 31st to issue W-2s to their employees. So what if you have not gotten yours?

First, contact your employer ask when these forms were mailed out. At times, employers may have incorrect employee addresses on file and the form may have been returned to them. If this, or another misunderstanding occurred, allow for a reasonable amount of time for the company to mail the W-2 out to you.

If, by February 14th you have not received your W-2, you should contact the IRS for further assistance at 800-829-1040. When calling, you will need to provide the IRS with your name, Social Security number, address, and phone number. They will also need the name of your employer along with their address and phone number. The dates of your employment will be required.

Here is the more difficult part, you will be asked to provide an estimation of the wages you earned, when you worked for this employer in 2011 and the estimated federal taxes withheld.  You can most likely get these estimates from your leave and earning statement or pay stub if need be.

After this, you have the options of requesting an extension or filing your return by April 17th. You can file your return even if you have not gotten your W-2 by the filing deadline. After contacting the IRS and giving said information, you can file using Form 4852 as a substitute in place of you W-2. Refunds may be delayed as information will have to be verified.

Finance and accounting employees are expected to increase in number during the first quarter of this New Year. Over one thousand CFOs were interviewed and stated that they have plans to add finance and accounting employees.

Locating professionals with the appropriate skills remains a challenge for many businesses, however. Numerous key roles in differing industries are needing to be filled and recruiting challenges are reported by sixty-eight percent of those CFOs who were surveyed.

Everyone wants the best employees and competition in this area is becoming fierce. Such professionals are becoming more and more at ease about seeking positions, even new roles, with other firms. While businesses remain selective, they jump on the right applicant when they see one.

During this first quarter, the most active hiring is expected to take place in the New England and Mountain states. The intent to hire full-time finance and accounting employees was strong, netting sixteen percent, in these areas when executives were interviewed.

In-demand professionals are proving difficult to find. Such in-demand professionals in the Mountain region include financial controllers, as well as financial analysts. In the New England states, biotech companies, construction companies and professional services are looking for financial analysts and internal auditors.  First quarter hiring is projected to be done by executives in the construction and transportation sectors. As shown by the survey, a combined 18 percent of each industry’s CFOs stated that they are prepared to increase staffing this year during the first quarter.

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The economy has hit many individuals hard and many are finding it necessary to file bankruptcy. Between the loss of jobs, high interest rates on credit cards and individuals finding they are upside down in their mortgages, they see no way out and no light at the end of the tunnel because unemployment payments simply won’t cover expenses.

Bankruptcy still carries with it a feeling of shame for those who file it and it isn’t a decision to be taken lightly. The stigma of bankruptcy may not be as much as it was in the past, before the recent economic downturn, but it is not a decision many people make easily.

In legal terms bankruptcy means that the courts allow individuals to either pay off their debts at a rate lower than what they owed (pennies on a dollar) or they may have the option to have all of their debts cleared and the slate wiped clean. While you can file bankruptcy without the help of an attorney, it is usually easier to have the help of a lawyer to navigate the court system and dealing with creditors.

There are a couple of bankruptcy types from which to choose and you will need to determine which is best for your particular economic situation. Be advised though that if you work with creditors to have your debts reduced, you will need to make every payment and any default could cause the debt to be called and paid in full. The importance of staying on a payment schedule cannot be stressed enough.

The relief brought through filing for bankruptcy and having your slate wiped clean may relieve your stress, but be advised that filing bankruptcy has long lasting ramifications to your credit history and your ability to qualify for credit in the future.

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Deciding on the accountant that is right for your small business can be a deciding factor in your business’s success or lack thereof.  This person will, in effect, be responsible for your business’s bottom line. As a lot will be riding on this decision, it must be made carefully.

After a company has selected and hired an accountant, making a transition to a new one is actually difficult and costly. This is just one more reason to make an educated decision. An accountant becomes part of your business, learning detailed information about you and your business. For this reason, businesses who realize that their accountant is not top notch often stick with the accountant because of the difficulties associated with a change.

A business should consider its needs. Not all accountants are equal. Therefore, it is important to know what to ask when looking for this important aspect of your business. Taking into deliberation the needs of your business, you will also want to choose the accountant who will assist your business in growing.

Issues to discuss with potential accountants include tax planning. This is not just about preparing your year-end tax forms. Throughout the year, a strong accountant will be involved in planning and advising. An accountant should be able to act as a general business consultant and offer solutions when examining issues such as risk management, internal controls, buying and leasing decisions, pricing, inventory and marketing.

The right accountant is one who understands the link between one’s personal finances and those of their business. An accountant should be able to advise in both areas inclusively. Small business capabilities are directly tied to technology and accountants need to be proficient in the application of inexpensive information technology. Lastly, a small business accountant should be able to aid a business in networking through those technologies they know.

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Hurricane Irene has left plenty of wreckage behind. Many businesses have been devastated by this disaster and are now faced with a mountain of insurance claims to conquer. In order to get your insurance claim attended to and helping you as soon as possible, avoid these common mistakes made by businesses.

First of all, a business needs to contact their insurer immediately. Do not wait until you have cleaned up damage before calling your insurance representative. The representative needs to see and document the destruction before it is fixed up. Next, document the damage yourself. If you find yourself faced with an immediate repair to avoid further damage or to protect your business, document the damage prior to anything being done. Take plenty of pictures from many different angles. Then take pictures of the repairs you do.

Another important thing to do is to keep damaged goods. This includes damaged flooring, insulation, merchandise, etc. Pile it up in the parking lot if you must until you are pleased and with the outcome of the insurance assistance and paid in full. This is evidence of the damage impact toward your business.

Do not feel as though you have to accept your insurance company’s first estimate. You have the right to appeal the estimate, if you think it is too low. To do so, hire an adjuster on your own for a second estimate. Tip number five, is to read your policy so that you are aware of what is covered and what is not.

Realize that if your business has been declared a disaster area by federal government, you will receive aid. However FEMA will not react quickly. Immediate help will most likely be available, but rebuilding aid will be slow-coming. Private insurance is your quickest route to get your business up and running again. Lastly, be prepared ahead of time. Know your policy before disaster strikes and decide if you have adequate coverage.