In a recent article in the Globe and Mail by Jennifer Warawa, nine reasons to work with an accountant were discussed. While this may seem self serving coming from an accountant, I see so many start up problems that could have been prevented with a short visit that I find this worth sharing. Here is the excerpt of those reasons:
“1. Focus on why you started your business. Entrepreneurs are passionate, and the more than half of small Canadian business owners surveyed went from business idea to opening in less than six months. With such rapid growth, business owners can’t afford to get bogged down with tasks that don’t help you continue to grow. Accountants can take on the heavy lifting of many different aspects of your business.
2. Find work-life balance. Regardless of how new or established a business is, owners across the board struggle with finding the right balance between work and having a life. In fact, maintaining a balance was the top challenge for startups. Accountants can take on the tasks you are less than thrilled about handling, and free you up to sell, market and grow during the day, and maybe even take your son to soccer practice at night.
3. A professional reputation. A good accountant will represent you and your company in the best possible way. This is particularly important as new businesses strive to build strong relationships with key players in their success, such as the bank.
4. It’s vital to a company’s success. As reported by the Sage survey, more established business owners report working with an accountant, agreeing that working with an accountant is a critical element in success.
5. A new perspective. Oftentimes entrepreneurs are so involved running the day-to-day operations of their business that they may not be able to see the whole picture. Someone who is removed from the business can provide a different perspective that may otherwise be missed. Meeting with an accountant can be like taking a step back, looking at the bigger picture and gaining a fresh, new perspective. Sometimes that’s all it takes to come up with the next big idea.
6. They have reach. Don’t underestimate how valuable it is to receive guidance from someone who has insight and knowledge across hundreds of businesses and industries. Accountants not only get to see the financial information of many businesses across a variety of industries, but they also have visibility into best practices that are working for other businesses as well as the mistakes others have made that have led to failure. Being able to have this insight and share information on what has or hasn’t worked for others is invaluable – why reinvent the wheel if you don’t have to?
7. Businesses need a plan. One reason thousands of businesses fail every year is because they didn’t have a plan. When asked why, they said, “I just didn’t know where to start.” This is where an accountant comes in. A good accountant will partner with a business to look at all the data and help build a road map to success. Poor planning isn’t necessary, and bringing a professional on board can help small businesses plan for success.
8. They understand tax. This may seem obvious, but keep in mind that rules and regulations change frequently, and it’s tough if not impossible for any business owner to keep up with it all. Twenty-nine per cent of Canadian small business owners admitted that accounting and bookkeeping is one of their biggest challenges. An accounting professional can take away your uncertainty and ensure your business stays compliant.
9. Analyze data for growth and profitability opportunities. If all of your data is just sitting in a database and you’re not interpreting, analyzing or using it to help drive your business direction and decisions, you’re missing out on a great opportunity. Have an accountant help you dive into the numbers and use them to propel greater business growth and profitability in the future. A great way to do this is through online collaboration in a small business accounting solution where accountants have visibility into clients’ financial data in real time.
Can your startup survive without the assistance of an outside accountant? Possibly, but the extra insight, guidance, and expertise an accountant offers can be the catalyst that makes your business thrive.”
At JamisonMoneyFarmer PC we have the expertise to get your start-up running smoothly and ensure that you are following the requirements related to sales taxes, payroll taxes, business licensing, and business registration.
The IRS announced last week that they have delayed the shared-responsibility requirement for employers who have 50-99 full-time equivalent employees in 2014. These employers will now have until 2016 to offer health care coverage to their employees or be subject to the shared-responsibility payments. These employers will be required to start reporting for health care coverage in 2015.
To be eligible for this delay, employers must not reduce their workforce or hours of service in order to qualify and they must maintain their previously offered health coverage.
For employers with 100 or more full-time equivalent employees, there is a phase in for the number of employees required to be covered. For 2015 70% must be offered minimum essential coverage and for 2016 and beyond 95% must be offered minimum essential coverage. If these employers do not meet these percentages or do not offer insurance that is affordable relative to the employee’s household income they will be subject to the shared-responsibility payments.
There are many additional requirements so be sure to consult your Trusted Business Advisor at JamisonMoneyFarmer PC if you have questions.
The Alabama Department of Revenue announced that when taxpayers electronically file 2013 Alabama Forms 40, 40-A or 40 NR, they should include their driver’s license or non-driver’s license number, as well as their date of birth, on their Alabama returns.
This is the department’s latest effort to combat the growing threat of identity theft and fraudulent tax return filings.
State Revenue Commissioner Julie P. Magee said, “It is just one more level of security. Just about every business transaction that is conducted requires some form of personal identification—credit card purchases, banking transactions, etc. Before a tax refund is issued from a taxpayer’s account, it is reasonable for a taxpayer not only to expect, but also to demand that the department takes every precaution that it can to ensure that the refund is a legitimate refund, and not a fraudulent refund issued to an identity thief. This information can be used as a simple, quick validation and will not affect the normal processing of one’s tax return.”
For the complete release, see ADOR’s website: ADOR Working to Offer More Protection from ID Theft and Fraudlent Return Filings
From the Small Business Monthly here are 4 signs you need a part-time CFO.
1. You don’t have key data about your cash flow, working capital or a forecast of liquidity. A company lives or dies on its flow of information. Expand your team to include someone who can collect, analyze, interpret and effectively disseminate these details.
2. No one is closely watching your expenses. Every dollar saved supports your company’s bottom line. Enlist top-level talent focused on a proactive approach to cost, including strategic partnering and make-or-buy decisions.
3. You are not aware of economic, industry and regulatory changes that could drastically affect your business. A CFO can help with identifying potential business risks, such as opening new offices in areas with high state and local taxes. With a CFO’s expertise, you can develop models and budgets to run your business efficiently and manage it to profitability.
4. You are unable to generate financial reports required by bankers, suppliers, shareholders, investors and partners. A CFO is well-equipped to evaluate offers and opportunities. He or she can help the capitalization or lending process by providing the credibility and expertise for third-party reporting. A CFO can also help with evaluating equity transactions and owner equity protection.
For a fraction of the cost for a full-time position, an outsourced CFO can provide strategic financial expertise to capitalize on opportunities and minimize risk.
Did you know that JamisonMoneyFarmer PC offers these services? We do! We are ready and able to help you take your company in the right direction. From payroll to bookkeeping to CFO services we are ready and able to meet your needs with experts and technology based solutions. Call your JMF Trusted Business Advisor today!
Maximizing your allowable deductions is key to minimizing your tax burden. Check out the JMF Guide to Maximizing Deductions.
The IRS implemented a new Form 8822-B on January 1st. It requires you to update your business’ responsible party information. Unless you have the same person responsible for your business taxes, including payroll taxes, since your company was formed, you need to file this form no later than March 1, 2014. While there are no penalties for not filing this form, if you don’t receive a notice because it is not updated the IRS will not consider abatement of any penalties and interest related to that notice.
This begs to question who is a “responsible party”? A responsible party is defined as “the person who has a level of control over, or entitlement to, the funds or assets in the entity that, as a practical matter, enables the individual, directly or indirectly, to control, manage, or direct the entity and the disposition of its funds and assets” according to the form instructions. “If the responsible party is an alien individual the entity should enter the person’s individual tax identification number in the space provided and submit a copy of an official identifying document or, if necessary, complete Form W-7, Application for IRS Individual Taxpayer Identification Number,” according to Michael Dell in the Tax Advisor.
Going forward Form 8822-B must be filed within 60 days of a change in responsible party.
If you need assistance with this new requirement, please contact our experts at JamisonMoneyFarmer PC
2014 Sales Tax Holiday for Severe Weather Preparedness Items
Set Feb. 21 through Feb. 23
Beginning at 12:01 a.m. (CST) on Friday February 21, 2014, and ending at twelve midnight on Sunday February 23, 2014, Alabama will hold its annual sales tax holiday giving shoppers the opportunity to purchase certain severe-weather preparedness supplies free of state sales or use tax.
A provision in the Severe Weather Preparedness Sales Tax Holiday law allows counties and municipalities to join the state by removing their own local sales and use taxes from the same items during the same weekend (Reference: Rule 810-6-3-.66).
To provide guidance to both retailers and consumers, the ADOR has compiled a listing of all cities and counties participating in the 2014 Severe Weather Preparedness Tax Holiday. The city and county listing is available at http://www.revenue.alabama.gov/salestax/WPSalesTaxHol.htm.
The following list contains examples of items covered under the Severe Weather Preparedness holiday.
Items below that have a sales price of $60 or less per item
Items below that have a sales price of $1,000 or less:
For more information about Alabama’s annual Sales Tax Holiday for Severe Weather Preparedness, visit ADOR’s Website at www.revenue.alabama.gov.