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So far Hannah Taylor has created 34 blog entries.
28 05, 2024

8 Accounting Challenges for Small Businesses

2024-05-28T09:51:38-05:00May 28, 2024|0 Comments

Managing a company often requires business owners to wear multiple hats in several roles, including customer service rep, marketing manager and accountant. Be prepared for all your roles by reviewing these common accounting challenges for small businesses and how to handle them.

Reporting finances

One of the biggest challenges a business faces is keeping up with the financial disclosures and reporting requirements that the United States Securities and Exchange Commission requires. But doing so ensures you document all your information correctly in case your company is audited.

Managing cash flow

A good way to help manage your business’s cash flow is to stay on top of billing and accounts receivable and regularly review your bills. Pay attention to your recurring monthly expenses to see if there are areas to downsize and cut costs where possible.

Remember to earmark funds for specific expenses to help keep cash flow steady and your small business thriving.

Covering unexpected expenses

A business can seem to be in perfect shape until an unexpected expense or emergency pops up. Setting certain funds aside for emergencies and using existing credit to help cover unexpected expenses can make a difference in your bottom line.

Updating expenses

Along with covering unexpected expenses, updating expenses is just as important. Keep track of receipts and recurring costs. Then claim them as small business deductions, as the IRS does require documentation.

Business deductions will lower your taxable income and give a better understanding of your company’s profits and losses.

Regulating payroll

Another one of the accounting challenges for small businesses to look out for is regulating payroll. Classifying employees, filing taxes correctly, paying employees and tracking employee time off are the tip of the iceberg when regulating payroll.

Analyzing finances

Track your finances by verifying all your business transactions regularly. Review your books at the end of each day with these steps in mind: interpreting, analyzing and advising.

Then ask yourself, “What do those numbers mean? How do we improve them?”

Filing taxes

Filing federal and state taxes can be stressful for business owners. Even though your business structure determines your tax obligations, most businesses must pay income, unemployment and payroll taxes.

In addition, businesses pay estimated quarterly taxes if they expect to owe $1,000 or more when filing. Failing to do this can result in fines and penalties.

Keeping up with policy changes

Tax laws are constantly changing. Stay current to reduce your chances of overpaying, underpaying and more.

Summary

Tackle these accounting challenges for small businesses with confidence by working with a trusted team of knowledgeable accountants, tax specialists and more. Contact Todd Greene, CPA, PLLC, to take your business to the next level.

Plus, continue reading our blogs for more accounting news and tips.

28 02, 2024

Direct Tax vs. Indirect Tax: What’s the Difference?

2024-02-20T10:50:06-06:00February 28, 2024|0 Comments

Direct tax vs. indirect tax. You’ve probably heard these terms before, but do you understand what they are and how they differ? Keep reading to learn the differences between direct tax and indirect tax.

What is a direct tax?

A direct tax is a tax levied on companies and individuals that cannot be passed onto another taxpayer.

What’s more? Direct tax is progressive, and the tax burden increases with income. Meaning, an individual with a high income will pay a disproportionate share of the tax burden, whereas someone with a lower income will see a small tax burden.

Direct tax types

There are five categories of direct tax: individual income tax, corporate income tax, capital gains income, estate tax and property tax.

Individual income tax

Individual income tax, or personal tax, is a tax imposed on salaries, wages, investments or other forms of income a household receives.

Corporate income tax

Incorporated businesses are taxed on their profits minus their allowable deductions. This is a corporate income tax.

Capital gains tax

Capital gains tax is a tax on the profit made from the sale of an asset, such as stocks or property. These tax rates can vary depending on two factors: income level and how long an asset has been held.

Estate Tax

Estate tax is a tax on the net value of a person’s taxable estate at the time of their passing. The estate pays the tax before any assets are distributed to the heirs.

Property tax

Property tax is a tax imposed on commercial and residential properties such as buildings and land. This tax can also be levied on tangible personal property like business equipment, inventory and vehicles. Property taxes vary between states.

What is an indirect tax?

Continuing with direct tax vs. indirect tax, indirect tax is a tax that can be passed on to another entity or individual. This type of tax can be imposed on goods or services.

Furthermore, an indirect tax is regressive. Meaning the tax is applied regularly regardless of an individual’s level of income.

Indirect tax types.

There are four main types of indirect tax: sales tax, excise tax, value-added tax and gross receipts tax.

Sales tax

Sales tax is a consumption tax on the sale of goods and services. This means once the tax is added to the sales price of a good or service, it is then charged by the retailer. The retailer then remits that tax to the government. Sales taxes differ from state to state.

Excise tax

Excise tax is a tax levied on specific goods such as alcohol, tobacco and fuel. Typically, companies pay the excise tax and then pass the cost of it onto the consumer—this is known as the hidden tax.

Value-add tax

Value-add tax, or VAT, is a tax on the value added at each stage of the production of a good. Each business along the production chain pays a VAT at that stage, and the business in the earlier stage is then reimbursed. Ultimately, the end consumer pays the VAT.

Gross receipts tax

The gross receipts tax is a sales tax that applies to business-to-business transactions. Businesses are required to pay on their gross receipts, or their gross sales, without deductions. The gross receipts tax is applied to the business, but the cost of the gross receipts is often passed onto the consumer.

Summary 

To summarize, it may help to talk to a professional when it comes to dealing with direct tax vs. indirect tax. If you are ready to start understanding your taxes better, give us a call at (704) 919-3220. And in the meantime, continue reading our blogs for more industry news and tips.

28 12, 2023

6 Accounting Resolutions for Your Business This New Year

2023-12-28T10:15:35-06:00December 28, 2023|0 Comments

With the new year just around the corner, it’s time to make your new year’s resolutions. And we don’t mean changing your diet or exercise routine—we’re talking about the resolutions you should make as a small business owner. Check out these accounting resolutions for your business this new year.

Meet with your accountant.

First and foremost, it is important you meet with your accountant. This will allow you to review your year-end numbers and lay out a plan of action in order to achieve the new year’s goals. Additionally, you should schedule regular meetings with your accountant to stay up-to-date on your finances.

Conduct a financial review.

Not so much a resolution, but an essential task for moving into the new year—if not every quarter—is to conduct a financial review. In doing so, you can double-check your figures and see if your business is in good financial standing as the year ends.

Understand any tax changes.

Tax codes and regulations change every year. This includes district, county, state and federal levels. Be sure, when meeting with your tax professional, that you review and understand the newest and most up-to-date regulations and how they will affect your company’s tax returns.

Update your accounting software.

When making accounting resolutions for your business this new year, add updating your account software to the list. There are a wide variety of accounting software options that can help your business run smoothly and more efficiently with accurate bookkeeping.

Talk to your clients.

When creating goals for your business in the new year, you will want to know what your clients wants and needs are, as well as where your business is excelling and lacking. Send out a survey or contact your clients for feedback in order to find where you can improve.

Set your business goals for the new year.

Now onto the most important resolution for your business: setting goals for the new year. How can you improve your business? How will you grow your revenue? Make a plan and set goals in order to streamline your accounting and more.

Summary

And don’t worry, if you’re searching for a team of trusted professionals that can help you with these accounting resolutions for your business this new year, contact Todd Greene! We can help you with small business accounting and bookkeeping, new business planning, tax preparation, tax planning and much more.

In addition, continue reading our blogs for more financial tips and accounting news.

27 10, 2023

Tangible Assets vs. Intangible Assets: What’s the Difference?

2023-10-24T11:25:33-05:00October 27, 2023|0 Comments

Businesses have many kinds of assets, including tangible assets vs. intangible assets. But what’s the difference? Let’s take a look!

What is a tangible asset?

A tangible asset is an asset that has a physical form, meaning it can be held and manipulated. These types of assets can typically be transacted for some type of monetary value through liquidity.

The owner of the tangible asset can decide to hire an appraiser who determines the fair market value of the asset, or they can choose to sell the asset for cash.

Types of tangible assets

Tangible assets come in two categories: current and fixed. Current assets are those that can be easily used and converted to cash. Fixed assets, on the other hand, have a lifespan of one year or more. For example, inventory is considered a current asset, and things like property and equipment are considered fixed.

There are many types of tangible assets. Some common forms include:

  • Equipment
  • Furniture
  • Inventory
  • Land
  • Property
  • Vehicles

Things such as stocks and bonds are also considered tangible assets, even though they cannot be held. This is because they derive their value from contractual claims.

What is an intangible asset?

An intangible asset is an asset that is not physical. This type of asset is recorded at its cost when acquired. Some intangible assets have a limited life and are more amortized to expense, while others have an unlimited life and are not amortized.

Types of intangible assets

The market value of a company’s intangible assets is often far greater than that of its tangible assets. Examples of intangible assets include:

  • Copyrights
  • Patents
  • Mailing lists
  • Trademarks, brand names and logos
  • Domain names
  • Goodwill

Summary

With that, it is now time to take a look at your tangible assets vs. intangible assets. Not sure where to get started or how to record them? Don’t stress—contact Todd Greene for all your booking and accounting needs!

And since you’re here, continue to check out our blogs for more accounting tips and news.

28 09, 2023

Business Entities Defined: Limited Liability Company and Its Benefits

2023-09-28T16:21:16-05:00September 28, 2023|0 Comments

Before you start a business, several decisions must be made, including the business structure. One of the most popular business structures in the U.S. is a limited liability company. So, let’s look at a limited liability company and its benefits more in depth to see if it’s the right setup for your future company.

What is a limited liability company?

For a better understanding of a limited liability company and its benefits, let’s start with the definition of a limited liability company. To summarize, it is a hybrid entity that combines the features of a corporation with those of a partnership or sole proprietorship.

Limited liability companies protect their owners from being held personally liable for the obligations of the company. Similar to a corporation, an LLC offers its owners limited liability in the event that the company fails. However, like a partnership, an LLC “passes through” its profits so that the owners must pay taxes on it as part of their individual income.

In fact, those very traits are two of the main advantages of a limited liability company.

The benefits of LLCs

One of the biggest benefits of a limited liability company is that it is a separate entity. In other words, the personal assets of company owners or members cannot be used to fulfill the company’s debts and other obligations. Therefore, members only risk losing what they invested in the company, not their individual belongings.

The flexibility of how an LLC is to be taxed is another one of the benefits. While LLC’s can be taxed as corporations, partnerships or sole proprietors, the default tax classification is as a sole proprietor if it has one member and as a partnership with two or more members.

In a nutshell, all the companies’ profits can be distributed directly to the owners, which are then taxed as part of their personal income. This prevents “double taxation” of the business and its owners because it’s only taxed once.

Whereas with a corporation, for instance, the profits are taxed first at the company level and then again once the profits are passed on to the business shareholders.

In addition to limited liability and streamlined taxation, limited liability companies are relatively easy to set up and offer a more flexible management structure than other types of business entities. However, rules and regulations vary state-by-state, so be sure to double-check your state’s requirements.

Summary

Now that we’ve reviewed more about a limited liability company and its benefits, get ready to take the next step with our help! Did you know we offer new business planning services? We do! Contact us to schedule your free consultation. In the meantime, keep reading our blogs for more industry news.

28 08, 2023

5 Tips for Getting Your Small Business Finances in Order

2023-08-28T12:12:08-05:00August 28, 2023|0 Comments

Managing your small business finances well is a crucial part of keeping your business running smoothly and successfully. Disorganized finances could mean sacrificing cash flow, missing out on valuable tax deductions and ultimately setting your business back. If you’re ready to get a better handle on your business finances today, check out these five tips for getting your small business finances in order.

Separate your business and personal finances.

Combining your business and personal finances (i.e., putting everything in the same bank account) may be tempting, but over time, it will complicate things. For one, it can be hard to track your business spending when you’ve consolidated it with your personal spending.

The first thing you want to do when setting up your business for financial success is to establish its structure to make a clear distinction between business and personal finances. Common options include LLCs (Limited Liability Companies), Partnerships, Sole Proprietorships and S Corporations.  

Hire a qualified bookkeeper.

Hiring a bookkeeper is a great way to help sort through your business finances and set up a financial plan. Professional bookkeepers can help restructure, reorganize and keep track of your business’s cash flow. 

These professionals understand marketing strategies and will figure out how to keep costs low, increase revenue and find potential tax breaks. In addition, bookkeepers can also reconcile your monthly books and create custom reports in order to plan your sales and marketing strategies.

Create a budget.

Running a successful small business is impossible without a business budget. Putting a budget in place allows you, as the business owner, to view the full picture when it comes to seeing where your money is coming from and where it is going. 

Additionally, creating a budget allows you to be wise about your spending priorities and be diligent in your future financial planning. This step is critical and can ultimately help relieve stress.  If you utilize QuickBooks, you can prepare a budget within it’s program.  

Limit your unnecessary expenses.

Take a look at your monthly expenses. Can your business survive without some? If your business can successfully run without certain expenses, get rid of them.

For your necessary expenses, try to downsize them. For example, you can try to find banks that don’t charge monthly fees or have any “hidden” fees.  QuickBooks has a built in way to plan out your expenses based up on your current spending.  

Create a plan to increase your revenue.

And now for one of the most important tips for getting your small business finances in order: creating a plan to increase your business’s revenue stream.

To do this successfully, you will need to have followed the previous steps. Once you’ve done that, you will be able to review your income and develop a concise plan to increase your revenue. 

Summary

Running a successful small business relies heavily on the status of your business finances. But by planning today and following these tips for getting your small business finances in order, you have all the tools you need to get started!

Need some help along the way? From setting up financial plans to handling bookkeeping and more, the Todd Greene team is here to help! Plus, for more financial tips and news, continue reading our blogs.

28 07, 2023

The Benefits of Working with an Enrolled Agent

2023-07-24T15:18:44-05:00July 28, 2023|0 Comments

By definition, the word “tax” is straightforward. Simply put, taxes are amounts of money collected by the government to pay for public services. However, in reality, taxes can be anything but simple, which is why the benefits of working with an enrolled agent are good to know.

They are tax experts.

While the benefits of working with an enrolled agent are varied, this is a big one! You are working with a tax expert when working with an enrolled agent.

First of all, specific, strict qualifications must be met to become an enrolled agent, including passing a comprehensive IRS exam. Candidates must demonstrate expertise in individual and business tax return preparation, representation and federal tax planning.

Secondly, to maintain their status, enrolled agents are required to finish 72 hours of continuing education courses focused on tax preparation every three years.

It’s a select group of individuals.

In fact, there are only two ways someone can become an enrolled agent. As mentioned, there is a three-part comprehensive exam.

Or, an individual can become an enrolled agent based on experience gained as a former IRS employee for a minimum of five years.

They can represent clients before the IRS.

In other words, enrolled agents earn the right to represent taxpayers before the IRS. More specifically, enrolled agents have unlimited practice rights, like attorneys and CPAs. CPAs can also represent clients before the IRS.

To clarify, it means an enrolled agent is free to represent any taxpayer. They are qualified to handle any and all types of tax matters. And, finally, there are no restrictions in terms of which IRS office they can represent clients before.

You won’t have to see or deal with the IRS at all.

Another one of the benefits of working with an enrolled agent is your agent can speak directly to the IRS on your behalf. Whether you receive a letter from the IRS or you are being audited, enrolled agents can represent you on any tax matter, no matter who prepared the tax return, for instance. Again, CPAs are also qualified to represent taxpayers before the IRS.

Summary

To summarize, an enrolled agent has earned the highest credentials granted by the IRS. If you are looking for a true tax professional to help handle your taxes, properly prepare your tax returns and more, look no further than an enrolled agent.

At Todd Greene, CPA, PLLC, we currently have two accountants in the process of earning enrolled agent status. We also have two CPAs on staff! Learn more about us, our team and our tax services—and find free tax advice—when you continue to read our blogs.

28 06, 2023

Understanding What It Means to Be a CPA

2023-06-28T09:49:26-05:00June 28, 2023|0 Comments

No matter what size your business is, it’s likely you’ll need a financial professional to help keep it on track. That’s where a CPA can help! But what exactly do they do? Let’s take an in-depth look to get a better understanding of what it means to be a CPA.

What is a CPA?

CPA stands for certified public accountant. Certified public accountant licenses are provided by the Board of Accountancy in each state.

It is important to note that not all accountants are CPAs. Becoming a CPA is a distinguished credential that shows dedication, knowledge and skill. Duties include accounting tasks such as producing reports as well as tax reporting and filing for both individuals and businesses.

Working with a CPA can help people and companies better create financial plans in order to minimize taxes and maximize their profits.

Becoming a CPA

To become a certified public accountant, individuals must have a bachelor’s degree in business administration, finance or accounting. From there, you must pass the Uniform CPA Exam in order to obtain the certified public accountant designation. In addition, there is a requirement of 150 hours of education and no less than two years of public accounting experience.

The official CPA exam has 276 multiple-choice questions, 28 task-based simulations and three writing portions. It is divided into four main sections: auditing and attestation, financial accounting and reporting, regulation and business environment and concepts.

Candidates must score at least 75% to pass each section.

But the work doesn’t end there—the CPA designation requires completing a number of continuing education hours annually.

CPA career paths

There are a wide range of career paths available for certified public accountants. This includes public accounting, corporate accounting or working in a government service. An individual with a certified public accountant designation can also move into executive positions such as chief financial officers.

Many CPAs generally work as accountants of some sort. That means they put together, maintain and review financial statements and other transactions. CPAs can also perform and sign off on audits.

Known for their role in tax planning and preparation, CPAs also file tax forms and returns. Moreover, they specialize in other areas such as auditing, bookkeeping, forensic accounting, managerial accounting and more.

Accountant vs. CPA

When understanding what it means to be a CPA, we must look at how they differ from an accountant.

An accountant is a professional with a bachelor’s degree in accounting. A CPA is a professional who has earned their license through education, experience and examination.

Additionally, CPAs are granted certain roles that only they can perform. This includes performing audits and preparing audited financial statements.

Summary

With a clear understanding of what it means to be a CPA, are you ready to find a CPA? Then contact Todd Greene and our team today! And finally, continue reading our blogs for more financial advice and industry news.

30 05, 2023

What to Do If You Missed the Tax Deadline

2023-05-22T14:15:31-05:00May 30, 2023|0 Comments

If you missed the April 18th tax deadline, don’t panic! Instead, keep reading to find out what to do if you missed the tax deadline last month.

File as soon as possible.

First of all, when it comes to what to do if you missed the tax deadline without requesting an extension, you should still file as soon as possible to limit interest and penalties.

The good news is that if you are owed a tax refund, you won’t receive any penalties for filing late.

Find out if you automatically qualify for more time.

Certain circumstances mean some taxpayers automatically get extra time to file and pay taxes without penalties or interest.

For example, if you are a disaster victim, in the military, support personnel in combat zones or a U.S. citizen who is working outside the country, you could qualify for an automatic extension. Find out more here.

File and pay what you can now.

If you didn’t file by the April 18th deadline and you owe taxes, you could be hit with at least two penalties. First, there is a failure-to-file penalty. Next, there is a failure-to-pay penalty.

Even if you do have penalties, don’t put filing and paying what you can off any longer. In fact, when you file and pay what you can, you can then request a payment plan from the IRS to help.

Use e-file with direct deposit.

If you know you owe taxes to the IRS, you can pay promptly and securely through several options, including Direct Pay, for instance.

Even if you don’t meet the IRS income threshold for filing taxes, file anyway.

Did you know you could be missing out on potential refundable tax credits by not filing? It’s true. Even if your taxable income is less than the IRS income threshold for filing, you should still file a tax return.

You may be eligible for tax credits such as the Earned Income Tax Credit.

Work with tax professionals.

Finally, work with tax professionals like the ones you will find at Todd Greene, CPA, PLLC, to help you take the next steps, like properly preparing your tax return.

Summary

Now that you know what to do if you missed the tax deadline recently, contact us to get started. For more helpful tax tips and other financial news, continue to read our blogs.

28 04, 2023

The Benefits of Year-Round Tax Planning for Business Owners

2023-04-21T11:40:06-05:00April 28, 2023|0 Comments

We know you just filed your 2022 taxes, but that doesn’t mean you should stop thinking about them! Taxes should be a part of your business’ strategy year-round in order to maximize your gains and minimize your losses. Let’s take a quick look at the benefits of year-round tax planning for business owners.

Helps mitigate your liabilities.

Creating a tax plan is essential for business owners in order to mitigate their liabilities, largely for those transactions that are taxed. By doing this and giving yourself time to prepare for taxes, you will see many benefits, including:

  • Avoiding common mistakes
  • Maximizing tax relief
  • Reducing your payable taxes by deducting your expenses from earned income
  • Having greater control over when you pay your taxes

An example of poor tax planning is taking in a large amount of revenue before the end of the year that could potentially move your business into the next tax bracket. Instead of paying more taxes because of the increased revenue, good tax planning would have your business receive that money at the start of the new year.

Keeps you up to date on tax laws.

Having a tax plan also helps you stay updated on tax laws and any changes. Since the pandemic, tax requirements and deadlines are constantly changing for businesses. A tax plan allows you to understand what’s changed and lets you reassess your strategy.

When you have a good understanding of current tax laws, you won’t risk infringement with new or updated regulations. You will also be able to minimize the number of errors on your return. By doing this, you won’t have as much worry about an audited return or owing more money.

Enables growth.

The benefits of year-round tax planning for business owners don’t just stop there. Strategic tax planning also allows you to understand your business and its financial health. That means you can make sound financial projections and investments.

With the help of proper tax planning, you can maximize the deductions your business is eligible for. In turn, your business can save money and fund future business ventures.

Summary

Now that you know these major benefits of year-round tax planning for business owners, are you ready to get started with your business tax plan? Then contact the Todd Greene team to learn how to build wealth and grow your business with confidence.

Finally, continue reading our blogs for more financial tips and industry news.

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