Most people prepare a budget by estimating sales for the year and then trying to cut down expenses as much as possible or by simply taking the prior year actual figures and adding 2% for inflation. This approach may work well for some, but there is a different mindset I encourage business owners to adopt when creating a budget. Consider taking your profits first and then working backwards to determine how much in expenses you anticipate which will ultimately determine how much in sales are required to meet your goals.
Cloud based technology has eliminated a majority of the time consuming tasks previously associated with bookkeeping. The automation of bookkeeping services has allowed me to focus on providing value added services to my clients such as budgeting, forecasting, and advisory services. Here is a list of my favorite cloud based services that have saved me and my clients from hours of manual data entry
There are two government organizations that most small business owners fear - the IRS and the Department of Labor. The regulations are extensive and most business owners do not have the knowledge or time available to commit to fully understanding how all the regulations may impact their business. The NH Department of Labor hosts free seminars all across New Hampshire every Spring to help educate employers on labor laws. I was fortunate to attend one of these seminars earlier this month and I’d like to share with you the top ten labor violations in NH as presented at this seminar
A bank reconciliation compares your record of transactions and balances to your monthly bank statement. I've encountered many small business owners who do not perform a monthly bank reconciliation and instead operate their business based on the funds available in their bank account. Proper reconciliations will ensure that you are getting paid and paying vendors promptly which will make cash flow management easier.
.Congratulations! Your business has started generating a profit and you have finally reached the point to reap the rewards of your hard work. There are two options to pay yourself (1) receive a salary through payroll or (2) distribute profits as an owner draw. The appropriate option will depend on your type of business.
Form 1099-Misc must be prepared and filed by small businesses who issue certain payments to independent contractors totaling over $600 per calendar year. For 2016, the IRS has changed the filing deadline to January 31 for both the employee and agency copies of Form 1099-Misc.
New overtime regulations will go into effect on December 1, 2016. Does your business employ any salaried workers making $47,476 per year or less? If so, then continue reading for more information on the steps your business should take to be in compliance with these new rules.
It is critical for small businesses to appropriately classify a worker's employment status for tax reporting purposes. Should employers incorrectly define a worker as an independent contractor, they may find themselves liable for past taxes including FICA and federal unemployment tax and any associated penalties and interest. This article defines the criteria necessary to assess the appropriate classification of your emloyees.
This January, the Treasury Inspector General for Tax Administration (TIGTA) announced they have become aware of over 5,000 victims who have collectively paid over $26.5 million as a result of IRS Tax scammers. This article discusses the techniques used by scammers and tips to avoid being scammed.
"Cash is King" which is why the cash flow statement is vital to a successful small business. You may hire a bookkeeper to record where all of the cash is earned and spent for your business. This bookkeeper may even provide a generic profit and loss statement or balance sheet produced from a canned report in Quickbooks or Peachtree. But how do you know the information is accurate? What type of benchmark should you use to determine if the numbers in these reports are good or bad? How do you even read this type of statement?