Category: Owning A Business

Tips For Small Business Accounting

2/15/2022

Hello, readers! Welcome back to the Hoods Tax & Accounting blog! If this is your first time here, welcome! We’re delighted to be able to share up-to-date information about taxes, bookkeeping, and accounting. Our blog is also dedicated to educating you about tax-advantaged savings accounts, tax provisions, programs, and more! We aim to provide you with the tools needed to meet your short and long-term goals. Our seasoned professionals are experts on the tax code, eligible deductions, and QuickBooks—all necessary fundamentals for saving you money! The Hoods Family has been around since 1988 and our comprehensive accounting and tax planning services are among the best in the Lowcountry. If you’re in need of tax preparation, accounting, QuickBooks training, or business consulting services, do not hesitate to schedule an initial consultation! We are officially in tax season. We recommend preparing early to maximize your savings and refund. We do offer contactless services using a combination of over-the-phone consultations and digital drop-offs, for safety and convenience. You can read more about our hours and submit a request for a meeting using our website!

For some small business owners, the phrase “tax season” can be unpleasant. But don’t worry– We are here to help! Today, we’ll be sharing some helpful tips for small business accounting.

Determine What Kind of Business You Are

One of the first things you will need to do as a small business owner is determine what type of business entity you are. You must register your business in the state you will be operating in. In South Carolina, businesses can operate as a sole proprietorship, partnership, corporation, or limited liability company (LLC).

A sole proprietorship is the simplest business structure. If you are the only owner of your business, you are automatically a sole proprietorship and there is no need to register with the state. However, you might need local business licenses or permits.
A partnership is similar to a sole proprietorship, but the business has two or more owners. There are two types: general partnerships (GPs) and limited partnerships (LPs). It is the default mode for businesses with multiple owners, so there is no need to register with the state. Each owner is personally liable for the business’s debts. Owners can deduct most business losses on their personal tax returns.
A corporation exists separately from the business’s owners. There are two types: C Corporations and S corporations. There are many more regulations and tax laws that a corporation must comply with. C Corporations are eligible for more deductions than any other business entity. Both C and S corporations are more expensive to create than sole proprietorships or partnerships.
Limited liability companies combine the flexibility of partnerships with the personal liability protection of a corporation. LLCs require registration with the state. You can choose whether you want to be taxed as a partnership or as a corporation.

Deciding your form of business will determine which income tax return form you have to file. For example, all businesses except partnerships must file an annual income tax return. Partnerships should file an information return. The IRS website provides information on business entities, as well as charts to help you determine which type of business you are. We provide small business consulting, so reach out to us if you want to know more!

Preparation and Communication: Hire an Accountant!

Now that you’ve determined your business entity, it’s time to start preparing for tax filing. Preparation is key, whether you are a first-time filer or a tax professional. Many small business owners manage their own bookkeeping, but as your business grows you may find that you need support. You’ll need to find an accountant or bookkeeper that is right for your business. It’s important to make sure your accountant is a good fit and is in tune with your business’s structure and goals. They should do more than just file your taxes. In fact, they should be someone you keep in contact with throughout the year– not just during tax season. As the structure of your business evolves, there will likely be new forms to fill out. Your accountant or bookkeeper should help you track your business’s spending throughout the year. This is vital for the longevity of your business’s success and growth. Think of them as a business partner. Working together with them is going to make the entire process easier for all. As a business owner, you have enough on your plate. Can you manage bookkeeping yourself while still giving your small business the attention it needs? Hoods Tax and Accounting can handle the bookkeeping for you. We also offer payroll services to make things easier for you.

Maintain Neat and Accurate Records

Make sure all records of your spending are easy to access and read. Your small business should invest in basic accounting software. This will help you keep track of your income and expenses and see all of your files in one place. Inadequate record-keeping can cause you to owe more money in the long run, and could cause your business to be denied deductions or credit. There are a variety of easy-to-use softwares out there. Here at Hoods Tax & Accounting, we are experts at QuickBooks! QuickBooks is a software aimed at small to medium-sized businesses. We offer QuickBooks training, so feel free to contact us today to get started!

Be Aware of Deductions You May Qualify For

Tax deductions are expenses that can be deducted from a person or business’s taxable income. There are quite a few tax deductions that small businesses can claim, so it’s important to be knowledgeable of what’s out there and figure out what you may qualify for. There are deductions for business meals, business insurance, legal fees, rent, phone and internet expenses, home office, charitable donations, startup expenses, and more. One deduction that might seem more relevant than ever before is the home office deduction. Since the start of the pandemic, many people have transitioned to working from home. However, not all people who work from home are eligible for this deduction. According to the IRS, employees are not eligible to claim this deduction. Additionally, there must be exclusive use of a portion of the home for conducting business on a regular basis. It’s important to research these different deductions ahead of time and take note of which ones your business may be eligible for. Waiting until the last minute could cause you to miss out on saving money!

Calculate and Understand Startup Costs

To go along with tax deductions, a specific one that you should keep in mind is startup expenses. When your business is brand new, this is especially relevant. You will have expenses such as rent, payroll, utilities, and professional services as well as things like permits, licenses, website creation, logo design, and even business cards. Although starting a business can be pricey, the good news is that some of these costs can be eligible for tax deduction. You should act quickly, though: You’ll need to claim the deduction for the tax year that your business officially opened. If you are interested in this deduction, it’s best to calculate and keep track of your expenses as soon as possible after starting your business.

Separate Business and Personal Expenses

Separating your business and personal expenses can have a range of benefits, including tax advantages. If these two intertwine, it can limit your eligibility for tax deductions. Having your personal expenses tied to your business expenses can also make it more difficult to accurately determine and report your business’s income. You don’t want to sit down and go through receipts to figure out which expenses were personal. If these expenses are not calculated accurately, it can be damaging to your business credit, which is the financial history of your company. Business credit can be used to borrow money, or loans, to purchase products and services. Ideally, this credit should be separate from the business owner’s credit. Getting a separate bank account and credit card for your business can be a step in the right direction. When looking for a bank to set up your business’s account, there are a few things you should think about. First, make sure the bank is conveniently located. Is there a branch close to your business? You’ll want to be able to get there whenever you need to. Next, gather as much information about the bank as possible. What kind of banking fees do they have? Are there fees per transaction? These will need to be factored into your business’s budget.
Conclusion
These are certainly not the only things you must do to start up your business and keep it running smoothly, but they are important first steps in the process! As stated above, Hoods Tax & Accounting offers a variety of services including small business consulting, QuickBooks training, tax preparation, accounting, payroll, and more! Visit our website for more information, as well as helpful links to resources you may find useful. Thank you for reading and we hope to see you back next time to keep learning about various tax and accounting topics!

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Quickbooks And Your Small Business

9/2/2020

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Running a small business can be a dream come true and very daunting. If you use all of the correct tools to help you run your company efficiently, it will be the dream you've worked for.

Starting a small business in 2020 might sound crazy, but more have popped up nationally than you might think. So many people have lost their jobs, been put on furlough, or are unable to do their jobs virtually that they had to do something. With the unemployment rate at an incredible high, many Americans have been forced to creatively do the pandemic pivot. With so many of us at home with nowhere to go, the birth of honing new or rusty skills and crafting abilities had the opportunity to flourish. People started posting their goods and wares on social media and out of the blue, they have a whole new little business operation running out of their homes.

Some people were already deep in the process of building their small business when the pandemic hit, while others found solace in being hired by one after their corporate jobs were eliminated. Whatever the situation, small businesses have become quite the lifesavers of 2020. To keep that success and productivity as safe and possible, every small business needs the proper tools to stay productive, organized, and financially stable. What is the best tool out there for these situations? Quickbooks!

We use Quickbooks ourselves and we offer classes to help small business owners and anyone out there grow and manage their money. One of the biggest reasons small businesses fail, according to Forbes, is because there is no business plan. Poorly managed bookkeeping can sink a business before it even had the chance to grow. Admittedly, bookkeeping is difficult, time-consuming, and very meticulous work. This is why working with a company like ours and using Quickbooks is so imperative. We both make sure that every part of your bookkeeping is done in a properly organized manner, allowing you to get back to the business of your business.

Quickbooks pro was created specifically for small businesses, and it is very user friendly. It does so much of the work for you, that it's hard to get yourself overwhelmed. With a small-ish price tag of $300, it's a very small price to pay for the huge benefits it gives you. Tax season, after using Quickbooks, should no longer be something you dread or fear. Everything will already be taken care of. It even comes with tutorials to help you get started, and the Quickbooks team is also available to help you when you need it. There are so many benefits just waiting to be used.

[START UP]

Everything you need to run your bookkeeping and a majority of your business is in one place in Quickbooks. It will save you time, money, and sanity.
It keeps you organized, and you can see your business growing and change in one place.
It can help you with everything from income and expense tracking to cash flow management and more.
It allows you to accept credit cards and bank transfers from where ever you are. It lets your business be on the go, never restricting your plans or goals.
It can help your employees. You can do your companies payroll in minutes. It even gives you the option to upgrade and let the QuickBooks professional bookkeeping team take care of your payroll.
You will no longer need to worry about manually tracking your employees. You can track their hours, overtime, and add that into payroll anytime and on any device.
If you need more, Quickbooks is there to help. You can connect and partner with a member of their professional bookkeeping staff if you want, and whenever you want.

[BENEFITS]

Money Management. Quickbooks allows you to pay bills, ask clients to pay you, and tracks all of your due dates for bills. You can print checks directly from the program, every transaction is recorded right into the program, and you can link your bank accounts to the program. You no longer need paper statements.
Billing. The program will record every expense, no matter the size. You can organize your billing by the client and by type of spending. You also no longer need to reconcile your books manually.
Invoicing and Reporting. The program tracks all of your sales automatically. It can create receipts and invoices at the touch of a button. It allows you to bill your clients individually or in large batches which helps when billing multiple clients for the same service. If you have merchant services through Quickbooks, you can accept credit card and debit charges. You can easily scan and deposit checks into your accounts. You also can create all kinds of financial reports including expenses, trends, year over year income, and more.

[MORE]

You can use Quickbooks with other software and programs you're already using. You can import documents from Excel and export data from Quickbooks to make tax preparation and filing extremely easy.
Security is also an added layer of comfort that the company offers, according to The Visual Communication Guy. Quickbooks data centers are monitored 24/7 and are under constant watch to make sure all of your assets are kept safe. It also comes with its own security so no one can just log into your accounts. It is also the leading software company in safety and the adaptation of new technology.
It allows you to customize your business plan for each client so they know that their business is a priority to you. It allows you to nurture relationships with your clients by being able to send messages, notifications, and custom reports through Quickbooks.

Coming to the point where you can own your own business is a huge accompaniment and celebration. Let that celebration continue and use all the right tools to help you and your company grow and stay organized. If you are looking for the best accounting services in Goose Creek, the best tax preparation in Goose Creek, business consulting in Goose Creek, bookkeeping in Goose Creek, or payroll services in Goose Creek, we are here for you! Our phone lines and inboxes are waiting for you. Don't hesitate! Please stay safe, everyone. We will see you soon!

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Podcasts for the Modern Day Homeowner

10/1/2019

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Tired of reading self-help books to learn how to be a smart first time home buyer or how to do a DIY project? Why not step it up to the next level and discover some of the most helpful and hilarious podcasts to reach your goals?

The end of September brought not only cooler temperatures but it also brought National Podcast Day on the 30th! Are you tired of researching ways to be a better homeowner? Are your Pinterest Boards so big that you don't even know where to begin? One of the best ways to stay up to date on the latest home trends, getting tips on how to buy a home, and how to handle your first DIY project is to listen to a podcast or two. And don't worry, when it comes to the topic of being a homeowner or working on your home, the number of podcasts out there for you to enjoy is pretty long. All you'll need to do is a little research to find exactly what you want to listen to!

In honor of National Podcast Day, let's explore some of the top Podcasts for Homeowners in 2019!

Young House Love

This podcast was created with first-time homeowners in mind!
This podcast was created by Sherry and John Petersik. They began their journey in 2017 with a blog that shared the trials and tribulations of buying a new home and renovating it. After renovating multiple homes since then, it led to the birth of this wonderful podcast.
It offers helpful tips on realistic remolding.
They talk about affordable materials, decorations, and furniture options for the home.
It is a very funny and honest show.
There are often guest speakers
They offer tips on purchasing your very first home.
They also offer tips when dealing with buyer's remorse.

Visit their website here : https://www.younghouselove.com/podcast-introduction/

The Money Pit

This is not just a podcast, it is also a radio show hosted by Leslie Segret and Tom Kraeutler.
They are both very educated and knowledgeable on how to make repairs and installations.
They offer help and inspiration for the first time owner attempting a DIY project or renovation.
The show itself has a call-in format, so there is always a lot of interesting and unknown information that will be shared, covered, and discussed every time you listen!

Visit their website here: https://www.moneypit.com/

Home: On

This podcast is hosted by Richard Gunther
The focus on the podcast is on smart and connected homes.
Every week Richard features a new home gadget.
The podcast has guest speakers on to talk about the smart home industry.
The podcast guest include both experts and consumers like you!

Visit his website at: https://www.thedigitalmediazone.com/category/podcasts/home-on/

It can be stressful to be a homeowner! But use your free resources to make the journey a fun and stress-free experience. Plug in your headphones and get started!

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Hoods Tax &
Accounting Blog

Tips For Small Business Accounting

Quickbooks And Your Small Business

Podcasts for the Modern Day Homeowner

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​Hoods Tax & Accounting Blog

Tips For Small Business Accounting

Quickbooks And Your Small Business

Podcasts for the Modern Day Homeowner

Author

Archives

Categories

Hoods Tax &
Accounting Blog