<p>While most people don't think of tax season as an exciting time to look forward to, it doesn't have to be something you dread. You'll be okay if you know what you're getting into and prepare. And there's no better time to prepare than right now, especially as we start approaching the end of the year.&nbsp;</p>



<p>If you wait until the following year to gather your records and tax data, you will make it much harder for yourself than it needs to be. You can do a lot in your year-end accounting to optimize your tax savings, <a class="link" href="https://www.sba.gov/business-guide/manage-your-business/pay-taxes" target="_blank" rel="noreferrer noopener">prepare to pay taxes in April</a>, and improve your planning and accounting overall.&nbsp;&nbsp;</p>



<p>Use your time while you’ve got it in 2022. Find out more and develop a small business year-end accounting checklist for your company to use this December.</p>



<h2>What is Year-End Accounting?</h2>



<p>For your 2022 tax return, you are only responsible for your income and expenses between January 1, 2022, and December 31, 2022. So as the end of the 2022 tax year gets closer, you are approaching your final chance to change how you calculate your taxable income.</p>



<p>End-of-year accounting is about the specific management and bookkeeping involved in preparing your company's accounts for the end of the fiscal year. Whether a business owner or a tax professional, the year's end is essential for attending to company finances.</p>



<h2>When Does the Accounting Year End?</h2>



<p>The accounting year may vary for each different business owner. Most businesses follow the calendar year, which means their accounting year begins on January 1 and ends on December 31. Other companies may have their 12-month fiscal year adapted for their schedule.</p>



<h2>Why Should Small Businesses Create a Year-End Accounting Checklist?</h2>



<p>The end of the year is an excellent time to be proactive in managing your tax bill. You can do a lot in year-end preparation to ease your tax burden and take control of your liability before you’ve closed the books for 2022.&nbsp;</p>



<p>Developing an accounting checklist and going through it with your staff or an accountant will set your business up for success in the tax season and the new tax year ahead. You can close out the tax year on your terms and prepare yourself to shift into the next one.&nbsp;</p>



<p>If you take a step back to planning at these natural transition times, you'll always react at the moment instead of deliberately moving toward the future. Keeping an end-of-year checklist for small business owners makes planning an intentional part of your year.</p>



<h2>6 Items to Include in Your Small Business Year-End Checklist</h2>



<p>You’re taking the time to make sure your company is in good financial shape for the next year with your year-end accounting checklist, but where do you start? Here are some critical items you should attend to as you wrap up the year.</p>



<ul>
<li>Tax deductions</li>



<li>Review and close out records for the year</li>



<li>Ensure you’re paying your quarterly estimated taxes</li>



<li>Estimate your tax liability</li>



<li>Get organized for the new year</li>



<li>Consult a tax professional</li>
</ul>



<h3>1. Maximize Your Deductions&nbsp;</h3>



<p>Tax deductions are an essential piece of your year-end accounting checklist. Claiming all your tax-deductible expenses will make a significant difference on your small business tax return, and all of those expenses need to happen before the accounting year ends.&nbsp;</p>



<p>Schedule your business expenses before the end of December if you want to be able to deduct them from your taxable income. On the other hand, you could postpone significant expenses until January if you expect to have more revenue to offset in the coming year.&nbsp;</p>



<h3>2. Review Your Books for the Year</h3>



<p>Your year-end closing process is about closing the books on the previous year's finances to be prepared for tax season. To get there, your bookkeeping for the last year needs to be thorough and complete.&nbsp;</p>



<p>Group similar transactions and set apart any major purchases made throughout the year. Identify refunds, income, and owner contributions. You should have a complete accounting of all your assets and liabilities, including accounts receivable and accounts payable that haven’t been processed yet, like unpaid debts or outstanding invoices. Double-check and update your inventory count of unsold goods.</p>



<p>Be sure to revisit and sort through these financial statements, too. If you let months go by before you go over these files, you will need to remember more to do this accurately and efficiently.</p>



<p><a class="link" href="https://1800accountant.com/services/bookkeeping">Bookkeeping for your small business</a> may initially seem manageable, but it can quickly become overwhelming. If you're struggling, reach out for assistance before submitting your information for tax preparation.&nbsp;</p>



<h3>3. Pay Quarterly Taxes</h3>



<p>Your year-end checklist should also remind you to<a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes"> stay current on your quarterly estimated taxes</a>. These are pre-payments to your tax bill based on what you expect to owe in a final accounting.&nbsp;</p>



<p>Here are the quarterly estimated tax deadlines:&nbsp;</p>



<ul>
<li>Quarter 1 Deadline: April 15</li>



<li>Quarter 2 Deadline: June 15</li>



<li>Quarter 3 Deadline: September 15</li>



<li>Quarter 4 Deadline: January 15 of the following year</li>
</ul>



<p>It's better to pay more in estimated taxes than underpay. If you underestimate what you owe, you could leave yourself with a large tax balance at the end of the year and get hit with underpayment penalties. Ensure your business is tax compliant by working with a <a class="link" href="https://1800accountant.com/services/quarterly-estimated-taxes">quarterly estimated tax expert</a>.  </p>



<h3>4. Estimate Your Liability Ahead of Time</h3>



<p>Another crucial step in year-end closing accounting is to estimate what you’ll end up owing on your final return. Knowing more or less how much you’ll owe in advance can help you prepare for filing and paying.&nbsp;</p>



<p>Spend time calculating your total gross receipts. Overstated receipts lead to paying unnecessary taxes, while understated income numbers can mean penalties with the IRS further down the road. You don’t want either to happen to you. You can work off of your tax records from previous years to get started.&nbsp;</p>



<p>Plan for a year-end accountant consultation to ensure you're on top of all your income streams and possible deductions. You'll need all of that information to get an accurate estimate of your final liability.</p>



<h3>5. Get Organized for the Next Year</h3>



<p>Ending a year is like completing a chapter in your life or the life of your business. You can close that chapter and begin a new one in a way that sets you up for success with organized recordkeeping.&nbsp;</p>



<p>Use your year-end accounting checklist to ensure you're ready for the new year. It's the perfect time to make significant changes to your process, try out new accounting software, or <a class="link" href="https://1800accountant.com/blog/accounting-trends">update your system with other recent accounting trends</a>.&nbsp;</p>



<h3>6. Check in with an Expert Accountant</h3>



<p>Be sure to set up an appointment with a professional before the last minute in April. Take the time now to consult with your accountant on how to do year-end accounting for your business.&nbsp;</p>



<p>It is an excellent opportunity to get ahead of the game and ensure you're as informed and prepared as possible with your year-end accounting checklist. Consulting with your accountant for year-end planning is a smart way to ensure you cover your bases.&nbsp;However you decide to proceed, your company’s finances are in your hands. It takes time to <a class="link" href="https://1800accountant.com/services/small-business-taxes">get your small business taxes done right</a>, and there’s no better time than the present to invest in future savings.</p>

While most people don&#8217;t think of tax season as an exciting time to look forward to, it doesn&#8217;t have to be something you dread. You&#8217;ll be okay if you know what you&#8217;re getting into and prepare. And there&#8217;s no better time to prepare than right now, especially as we start approaching the end of the [&hellip;]

A calendar highlighting the importance of year end accounting.

Year-End-Accounting-Tips-blog-header

Year-End Accounting Checklist for Small Business Owners

Navigating small business bookkeeping and recordkeeping can be a daunting task for many business owners. However, a well-structured financial system is vital to the growth and success of your business. In our latest blog article, we deep dive into bookkeeping and recordkeeping, explaining their roles in business operations and the benefits they can have on your small business.

You might be asking: <a class="link" href="https://1800accountant.com/blog/small-business-bookkeeping">What's bookkeeping?</a> How can I keep records for my small business? What type of records should I keep? Do I need to save all business expense receipts? How long should I keep business documents? We've got answers to these questions and more. Continue reading so you can turn that financial confusion into clarity!
<h2><span style="font-weight: 400;">What Is Bookkeeping?</span></h2>
<span style="font-weight: 400;">Bookkeeping is a method of </span><a class="link" href="https://smallbusiness.chron.com/master-bookkeeping-60937.html" target="_blank" rel="noopener"><span style="font-weight: 400;">tracking funds</span></a><span style="font-weight: 400;"> and business documents that flow in and out of your small business. There are two types of bookkeeping: single-entry bookkeeping (for transaction entries only) and double-entry bookkeeping (for transaction entries and company cash flow). As you track your funds, you’ll compile categories, including business expenses, payroll records, employee records, revenue, and taxes.</span>
<h2><span style="font-weight: 400;">How Do I Keep Books for a Small Business? </span></h2>
<span style="font-weight: 400;">There is a </span><a class="link" href="https://bizfluent.com/how-4967598-compile-corporation-record-book.html" target="_blank" rel="noopener"><span style="font-weight: 400;">relatively simple method</span></a><span style="font-weight: 400;"> that you can implement in financial record keeping for your small business with just two binders. One will contain documents required within your state, such as licenses and permits. It would be best if you keep the following in the official binder: </span>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Articles of Incorporation or Articles of Organization </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Certificates </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Company seal</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Meeting Minutes </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Resolutions </span></li>
</ul>
<span style="font-weight: 400;">The second binder will contain daily records and most (if not all) financial transactions. Keep the following in your daily records binder:</span>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Accounting records </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Applications and permits</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Contracts entered by the company</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Insurance policies held by the company</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Membership certificates</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Names and addresses of all members or shareholders</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">An operating agreement or by-laws and any amendments</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Share transactions</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Shareholder interests</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">State filings (such as annual reports)</span></li>
</ul>
<span style="font-weight: 400;">As your business decides what it will implement over time, attempt to record everything in print. Divide the above sections into specific areas in your binders to remain organized. It is important to note everything, whether it's formal and official (meetings and minutes) or unofficial (daily activities). You should also date the records for even more accuracy. </span>
<h2><span style="font-weight: 400;">What Kind of Records Should a Small Business Keep?</span></h2>
<span style="font-weight: 400;">Whether you are using an accounting software program or other forms of financial record keeping, it is essential to know what kind of records you should keep. Keep receipts that pertain to <a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/what-kind-of-records-should-i-keep" target="_blank" rel="noopener">expenses, gross receipts, and purchases</a> to track your small business’s <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-debits-credits">debits and credits</a>, along with its income. </span>
<h3><span style="font-weight: 400;">Gross Receipts Documents: </span></h3>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Cash register tapes </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Deposit information (cash and credit sales) </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Forms <a class="link" href="https://1800accountant.com/blog/what-is-a-1099">1099-MISC</a></span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Invoices </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Receipt books</span></li>
</ul>
<h3><span style="font-weight: 400;">Financial Statements: </span></h3>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Canceled checks or other documents proving payment/electronic funds transferred </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Cash register tape receipts </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Credit card receipts and statements </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Invoices</span></li>
</ul>
<h3><span style="font-weight: 400;">Expense Documents:</span></h3>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Bank account statements</span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Canceled checks or other documents proving payment/electronic funds transferred </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Cash register tape receipts </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Credit card receipts and statements </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Invoices</span></li>
</ul>
<h2><span style="font-weight: 400;">Do I Need Receipts for Business Expenses</span></h2>
<span style="font-weight: 400;">While you do not need receipts for filing taxes or proving business expenses, small business owners can still benefit by keeping receipts. This will facilitate <a class="link" href="https://1800accountant.com/blog/how-to-reduce-tax-liability">decreasing your tax liability</a>, or the amount you'll owe in taxes. Some receipts can cause tax deductions, allowing you to save when it is time to file taxes. </span>

<span style="font-weight: 400;">You'll need </span><a class="link" href="https://finance.zacks.com/must-receipt-deductions-3147.html" target="_blank" rel="noopener"><span style="font-weight: 400;">receipts</span></a><span style="font-weight: 400;"> related to:</span>
<ul>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Bills for a product or service  </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Meals and travel </span></li>
 	<li style="font-weight: 400;"><span style="font-weight: 400;">Other items such as bonds, depreciated equipment, real estate, and stocks</span></li>
</ul>
<span style="font-weight: 400;">The IRS doesn't require receipts for business expenses that cost under $75 except for lodging. If you use a Schedule C Form for your business to deduct health insurance premiums, you don't need a receipt. Provided that you save the receipts and </span><a class="link" href="https://bizfluent.com/info-12131745-lost-business-receipt.html" target="_blank" rel="noopener"><span style="font-weight: 400;">you don't lose them</span></a><span style="font-weight: 400;">, you'll have a better chance to receive deductions and even reimbursements for your business expenses. </span>
<h2><span style="font-weight: 400;">How Long Do You Have to Keep Business Documents?</span></h2>
<span style="font-weight: 400;">You should keep documents and </span><span style="font-weight: 400;">business</span><span style="font-weight: 400;"> receipts</span><span style="font-weight: 400;"> for </span><a class="link" href="https://finance.zacks.com/irs-requirements-receipts-9289.html" target="_blank" rel="noopener"><span style="font-weight: 400;">at least three years.</span></a>

<span style="font-weight: 400;">This time frame includes the potential for IRS audits, which is why you should save all of the documents and receipts that you need. Also, that time frame increases to six years if the IRS suspects that you underreported your income. </span>
<h2><span style="font-weight: 400;">Work with Professional Accounting Services</span></h2>
<span style="font-weight: 400;">Bookkeeping can help your company track various categories of expenses, income</span><span style="font-weight: 400;">, and </span><span style="font-weight: 400;">tax payments</span><span style="font-weight: 400;">. With your bookkeeping needs, it may be wise to consider reaching out </span><span style="font-weight: 400;">for</span> <a class="link" href="https://1800accountant.com/services/small-business-taxes"><span style="font-weight: 400;">small business</span><span style="font-weight: 400;"> account</span><span style="font-weight: 400;">ing services</span></a><span style="font-weight: 400;">. Don’t hesitate to seek advice from experts to guide your small business on a path to business success.</span>

Navigating small business bookkeeping and recordkeeping can be a daunting task for many business owners. However, a well-structured financial system is vital to the growth and success of your business. In our latest blog article, we deep dive into bookkeeping and recordkeeping, explaining their roles in business operations and the benefits they can have on [&hellip;]

A woman with curly hair works at a home office desk, writing notes beside a laptop in a well-lit room with white walls and a blue clock.

bookkeeping-101-a-crash-course-in-record-keeping-for-small-businesses-2

Small Business Record-Keeping: 3 Best Practices &#038; Tips

Simple Record Keeping for Small Businesses

<p>Transforming a dream into a thriving business requires ingenuity, planning, and tireless dedication. But to truly elevate your venture and foster growth, there's another essential skill to acquire – understanding the profit and loss (P&amp;L) statement. </p>



<p>Navigating the financial landscape is critical to keep your company thriving, and while you don't need to be an accounting expert, understanding the basics is vital to your business's success.</p>



<p>Even if you have trusted professionals in your corner, being well-equipped to decipher the information provided ensures you remain in control. By learning to read P&amp;L statements (also known as income statements), you'll have the foundation to confidently make informed decisions for your business.</p>



<p>Don't wait any longer! Read this quick and easy-to-follow guide to unlock the keys to understanding the profit and loss statement today.</p>



<h2>What is a P&amp;L statement?&nbsp;</h2>



<p>A P&amp;L statement is a key financial document that reports on the status of a company’s financial health. It’s regularly produced by accountants for owners, entrepreneurs, and investors to assess the health of a business.</p>



<h3>What Does P&amp;L Stand For?&nbsp;</h3>



<p>P&amp;L stands for profit and loss, which are the principal factors assessed in a P&amp;L statement. Knowing how to read a profit and loss statement simply requires looking for the net income of a business over time.&nbsp;&nbsp;</p>



<h3>What sets it apart from other financial statements?&nbsp;&nbsp;</h3>



<p>A profit and loss statement reports on a company’s overall revenue and expenses over a certain period of time, usually monthly, quarterly, or by fiscal year. It is an income statement reporting directly on a company’s net profits. A single look at a profit and loss statement should tell you if the company is profitable or not.</p>



<h4>Cash Flow Statements&nbsp;</h4>



<p>There are two other key financial statements businesses regularly use to report and assess their finances: the cash flow statement and the balance sheet. The cash flow statement, unlike the P&amp;L, is not interested in net income but in the regular flow of cash in and out of the business.&nbsp;</p>



<p>A business needs a reserve of cash on hand to make purchases and pay bills. Even with high net profits, a company with poor or inconsistent cash flow will run into trouble when bills are due, and they find themselves without any cash on hand to pay with.&nbsp;</p>



<h4>Profit and Loss vs. Balance Sheet</h4>



<p>While cash flow statements and P&amp;L statements both report on finances over time, a balance sheet is intended to report on a given moment in time. It’s a snapshot of the current chart of accounts.&nbsp;</p>



<p>The balance sheet includes a comprehensive report of the current state of a company’s finances, balancing assets and liabilities. <a class="link" href="https://www.apaservices.org/practice/business/finances/balance-sheet" target="_blank" rel="noreferrer noopener">Reading the balance sheet and the snapshot it provides</a> is most helpful when comparing it to previous balance sheets.&nbsp;</p>



<h2>What goes into a profit and loss statement?</h2>



<p>A lot of different ingredients go into a profit and loss statement. The document should give you a full picture of your income over a set period of time. Ensure you’re familiar with the <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-30-common-bookkeeping-terms">common bookkeeping terms and financial language</a> you’ll find in a P&amp;L report.&nbsp;&nbsp;</p>



<h3>Revenue</h3>



<p>The top line of the P&amp;L statement should be your total revenue. This is the money you’ve received from all of your sales. How much money have you made?&nbsp;</p>



<h3>Cost of Goods Sold (COGS)</h3>



<p>The next step is the cost of goods sold, or COGS. COGS includes the raw materials and production costs of your products.</p>



<h3>Gross Profit</h3>



<p>To find your total gross margin of profits, subtract COGS from your revenue. This is the gross profit you’ve earned through sales.&nbsp;</p>



<h3>Operating Expenses</h3>



<p>After revenue, the P&amp;L statement reports on your operating expenses organized into various categories. This is where you include all your normal business expenditures outside the costs of the goods themselves.&nbsp;</p>



<p>This includes both direct and indirect costs of operation. Direct costs are the immediate operation costs, like employee wages and the materials associated with COGS. Indirect costs include everything else, from rental costs to utilities and insurance premiums.&nbsp;</p>



<h3>Net Operating Income&nbsp;</h3>



<p>Your net operating income represents your total income after you’ve taken out your operating expenses. These are your earnings before interest, taxes, depreciation, and amortization.&nbsp;</p>



<h3>Other Expenses</h3>



<p>Profit and loss statements should include other expenses like interest expense, income taxes, depreciation, and amortization, but they should be counted separately. These aren’t operating expenses, but they still have to get paid.&nbsp;</p>



<h3>Net Loss or Profit&nbsp;</h3>



<p>The bottom line of the P&amp;L statement is the final, most important total. This is your net loss or profit as a business. That means it’s the total revenue minus all of your expenditures.&nbsp;</p>



<h2>How to Read a P&amp;L Statement</h2>



<p>At first glance, a detailed P&amp;L statement may look intimidating. How do you figure out how to read a profit and loss statement when it’s just a long list of revenue and expenses?&nbsp;</p>



<p>The critical thing is to note the separate categories. Find the number totals at the end of each section before you get into the weeds and read the lists themselves.&nbsp;</p>



<p>You should be able to find the most essential takeaways at the beginning and the end of the statement as well. The top line will be your total revenue or sales, and the very bottom line of the P&amp;L statement will be your net income after all of your expenses have been subtracted from profits.&nbsp;</p>



<p>These are the essential sections you should find when reading a P&amp;L statement:&nbsp;</p>



<ul>
<li>Gross profits, which will be the total of your revenue minus the cost of goods sold (cogs)&nbsp;</li>



<li>Operating expenses split into separate categories</li>



<li>Non-operating costs like taxes and interest expenses</li>



<li>Net profits after subtracting total expenses.&nbsp;</li>
</ul>



<h2>Importance of Reading a P&amp;L Statement Accurately</h2>



<p>What is a profit and loss statement for if you don’t know how to read it? Your business plan is only as good as the data it’s based on, and the profit and loss statement is a key source of data for <a class="link" href="https://www.sba.gov/business-guide/manage-your-business/manage-your-finances" target="_blank" rel="noreferrer noopener">understanding your business</a>.&nbsp;</p>



<p>The bottom line of the P&amp;L statement tells you if your company is profitable or not. Once you have a sense of the larger picture, you can go into the details to see where you can trim expenditures or increase profits.&nbsp;</p>



<h3>How 1-800Accountant Can Help With Your Bookkeeping&nbsp;&nbsp;</h3>



<p>It’s important to know how to read a profit and loss statement, but you don’t have to know everything about accounting and bookkeeping. In fact, it’s better to have an expert who can help you review your financial situation.&nbsp;</p>



<p>Don’t hesitate to seek out professional <a class="link" href="https://1800accountant.com/services/bookkeeping">help with your small business bookkeeping</a> if you’re not sure how to read P&amp;L reports or if you want a second opinion. Get an expert from 1-800Accountant to show you how to analyze a profit and loss statement and make more efficient choices for your company.&nbsp;</p>

Transforming a dream into a thriving business requires ingenuity, planning, and tireless dedication. But to truly elevate your venture and foster growth, there&#8217;s another essential skill to acquire – understanding the profit and loss (P&amp;L) statement.  Navigating the financial landscape is critical to keep your company thriving, and while you don&#8217;t need to be an [&hellip;]

How-to-Read-Profit-&#038;-Loss_blog-header

How to Read a Profit and Loss (P&#038;L) Statement

How to Read a Profit and Loss (P&L) Statement

<p>All small businesses, regardless of industry, require good management and accounting. Your company is a complex system. To run the business well, you need a cool head and the ability to juggle many moving pieces. The real estate business is certainly no exception. </p>



<p>From working with clients to acquiring and managing properties, there are a lot of moving parts in real estate. That’s where real estate accounting comes in. Use this real estate accounting guide to support your business as it grows and expands.&nbsp;</p>



<h2>What is real estate accounting?&nbsp;</h2>



<p>Real estate accounting is simply the work of financial accounting for a real estate business. It involves monitoring all financial activity, maintaining records, and then reporting and planning for the future of the business based on the information gathered. </p>



<p>It is a broad field that includes a range of important work. Here are just a few of the tasks involved:</p>



<ul>
<li>Recording financial data and issuing regular reports</li>



<li>Financial planning and projections</li>



<li>Tax preparation&nbsp;</li>



<li>Managing healthy cash flow&nbsp;</li>



<li>Ensuring compliance with state and federal laws&nbsp;</li>
</ul>



<h2>Who needs real estate accounting?&nbsp;</h2>



<p>All real estate professionals rely on real estate accounting, whether they know it or not. The larger the operation, the greater the real estate accounting needs. However, even independent real estate agents with smaller operations may struggle to stay on top of their finances. Without dedicated accounting services, it can be difficult to know what the right decisions are when it comes to the financial side of the business.&nbsp;</p>



<p>All real estate professionals need good accounting to stay informed about the health of their business, make appropriate plans for future financial health, and manage all their <a class="link" href="https://1800accountant.com/blog/5-great-things-know-rental-income-taxes">tax and legal obligations</a>. This includes property management companies, individual realtors, landlords, and agents working for large companies. </p>



<h2>Bookkeeping vs. Accounting for Real Estate Businesses</h2>



<p>What is real estate accounting, and how is it different from bookkeeping? <a class="link" href="https://1800accountant.com/blog/bookkeeping-vs-accounting" target="_blank" rel="noreferrer noopener">Both bookkeeping and accounting are important</a> for a company’s financial stability, and they tend to overlap and depend on each other for maximum efficacy.&nbsp;</p>



<p>Bookkeeping is the practice of maintaining clear and accurate records. Effective bookkeeping for real estate agents means tracking income, business transactions, and expenses. It means keeping records of everything and then ensuring those records are accurate and easy to access.&nbsp;</p>



<p>Real estate accounting is about using the data gathered from your bookkeeping system to comply with real estate regulations and tax laws.&nbsp;</p>



<h2>How does good real estate accounting make a difference?</h2>



<p>What difference does good accounting make for a real estate business? For lone entrepreneurs or small firms, you may be tempted to do the accounting by yourself. However, unless you’re going in with a wealth of expertise, you could put your company at risk.&nbsp;</p>



<h3>Plan and Project&nbsp;</h3>



<p>Without reliable and accurate accounting, you’re operating your business in the dark. How can you adapt and prepare for growth if you don’t have the data or the skills to analyze it? Without a readable and comprehensive <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-what-is-an-income-statement">income statement</a> in your hand and an updated chart of accounts, you don’t have a clear picture of your company’s health.  </p>



<p>Good <a class="link" href="https://1800accountant.com/services/industry/real-estate">real estate accounting</a> means having the ability to observe the market, make reasonable projections of where your investments will lead, and plan appropriately according to those estimates.&nbsp;&nbsp;</p>



<h3>Cutting Costs and Improving Process</h3>



<p>An expert accountant can look over your finances and pinpoint the excess. Where are you wasting resources, and where are there investment opportunities?&nbsp;</p>



<p>The goal is to increase efficiency and optimize your process. What steps can be simplified in your company’s workflow? Could some business accounts be consolidated or separated to make financial reporting easier?&nbsp;</p>



<h3>Tax Filing and Audit Protection</h3>



<p>Tax law is changing all the time, and no one knows it better than a professional accountant. A good real estate accountant can make it simple and easy to complete and <a class="link" href="https://1800accountant.com/blog/prepare-file-small-business-tax-return">submit your small business tax return</a>. They’ll also help you maximize your tax savings and prepare you in case of an audit.  </p>



<h2>Important Items to Track in Real Estate Accounting</h2>



<p>Business analysis and planning can only be as good as the information it’s based on. That means that your accounting depends on careful bookkeeping. You need to keep track of everything and create real estate accounting entries in your ledger for every exchange and transaction that occurs.&nbsp;</p>



<p>If you’re just starting out and establishing your bookkeeping processes, these are the key things to track:</p>



<ul>
<li>Expenses</li>



<li>Revenue</li>



<li>Accounts receivable&nbsp;</li>



<li>Accounts payable&nbsp;</li>



<li>All business transactions&nbsp;</li>



<li>Other assets and liabilities like rental property and mortgages</li>
</ul>



<p>This is the data that you’ll use to put together your financial statements. These reports should give you a snapshot of your financial health.</p>



<h3>What is cash flow, and why is it so important?</h3>



<p><a class="link" href="https://1800accountant.com/blog/cash-flow-management">Cash flow</a> measures the inflows<a class="link" href="https://www.investopedia.com/terms/c/cashflow.asp#:~:text=Cash%20flow%20is%20the%20movement,of%20cash%20over%20some%20time." target="_blank" rel="noreferrer noopener"> </a>and outflows of funds for your business in order to assess the liquid assets you have available at any given time. Assets are great, but there is no substitute for having accessible funds in your bank account. </p>



<p>You may have a lot of valuable properties and rent due by the end of the month; if you don’t have cash on hand when your bills are due, that’s not good news.&nbsp;</p>



<h2>Get Accounting Services from a Professional</h2>



<p>If you don’t feel like you know how to do real estate accounting alone, don’t hesitate to consult an expert. Find an accountant you trust to help you improve your company’s financial foundations.&nbsp;</p>



<p>You might not have the resources to hire a full-time accountant, but it’s possible to get <a class="link" href="https://1800accountant.com/services/industry/real-estate">high-quality real estate accounting help</a> without breaking the bank. Any money you spend on accounting services, you’re likely to make up in improved efficiency, planning, and savings on your small business taxes. </p>

All small businesses, regardless of industry, require good management and accounting. Your company is a complex system. To run the business well, you need a cool head and the ability to juggle many moving pieces. The real estate business is certainly no exception.  From working with clients to acquiring and managing properties, there are a [&hellip;]

Modern kitchen interior featuring white cabinetry and a blue island, with text overlay about a guide to real estate accounting.

Real-Estate-Accounting-A-Simple-Guide_blog_header

Real Estate Accounting: A Simple Guide for Your Complex Business

<p><a class="link" href="https://1800accountant.com/blog/complete-guide-start-business">Starting a business</a> can be equally exciting and stressful. Before you can get your business up and running, there’s much to consider regarding small business accounting and taxes. Ideally, a CPA (certified public accountant) tax accountant could handle everything from the initial <a class="link" href="https://1800accountant.com/services/ein-tax-id-filing">EIN filing</a> to business tax preparation on your behalf, so you can focus on growing your business. </p>



<p>When you work with a pro, you don’t need to have a background in finance. However, you should still know these five things about small business accounting.&nbsp;</p>



<h2 id="h-1-use-separate-bank-accounts-for-business-and-personal-use">1. Use Separate Bank Accounts for Business and Personal Use</h2>



<p>Entrepreneurs often joke that they’re married to their businesses. However, while joint bank accounts are standard for spouses, entrepreneurs should draw a clear line between their business and personal expenses.&nbsp;</p>



<p>It might be tempting to consolidate all your expenses into a single account, especially in the early stages of starting your business. However, you’ll quickly realize how difficult it can be to remember what you purchased at the end of the month. Also, consider the struggles you’ll face if you receive an <a class="link" href="https://1800accountant.com/blog/you-received-an-audit-notice-now-what">audit notice</a> and have to sort through endless piles of documents, receipts, and bills to decipher which expenses were business or personal.&nbsp;</p>



<p>Keeping your business expenses in a separate account will simplify this process and help you stay organized.</p>



<h2 id="h-2-save-for-taxes-from-the-beginning">2. Save for Taxes from the Beginning</h2>



<p>Small business expenses and revenue ebb and flow — it’s part of the excitement of a new business. However, it’s critical to set aside enough money for the taxes you’ll eventually need to pay. Don’t underestimate how much money you’ll need for future tax payments. Failure to pay your taxes will only lead to trouble with the IRS; it’s wise to <a class="link" href="https://1800accountant.com/services/business-tax-advisory">consult with a tax accountant</a> who can advise you on small business tax preparation and get you started on the right foot. By planning ahead and saving, you’ll avoid any unpleasant surprises when it comes time to pay the IRS.&nbsp;</p>



<h2 id="h-3-track-income-and-expenses">3. Track Income and Expenses</h2>



<p>One of the many perks of being a small business owner is defining your income amount and deciding <a class="link" href="https://1800accountant.com/blog/pay-yourself-small-business-owner">how to pay yourself</a>. Depending on your business classification, you’ll either pay through an owner’s draw or a regular salary.&nbsp;</p>



<p>Regardless of the method, you’ll need to track this income and all of your other business expenses like rent, cost of goods, and payroll for any additional employees. This is a critical practice not only for your small business tax preparation needs but also for your personal taxes.&nbsp;</p>



<p><a class="link" href="https://1800accountant.com/services/income-taxes">CPA income tax prep</a> is an easy solution to keep your financial records organized and readily available for tax season. Income taxes can become complex when you’re a small business owner, so give yourself peace of mind knowing that a financial expert will handle the details.</p>



<h2 id="h-4-track-assets-liabilities-and-equity">4. Track Assets, Liabilities, and Equity</h2>



<p>Income and expenses aren’t the only financial details you need to track for your business. Assets, liabilities, and equity are equally important to record because they give a bigger picture of your business's financial standing.&nbsp;</p>



<p>Assets refer to what a business owns, including accounts receivable and cash equivalents like money market funds.&nbsp;</p>



<p>Liabilities are the debt or other financial responsibilities that the business owes.&nbsp;</p>



<p>Finally, equity is the difference between assets and liabilities. The equity reflects the total value of a business if the assets were liquefied and the liabilities paid.&nbsp;</p>



<p>If you’re concerned about staying on top of your financial records, consider <a class="link" href="https://1800accountant.com/blog/outsource-accounting">outsourcing these duties</a> to an online accountant who can see trends and other details that might otherwise go unnoticed.&nbsp;</p>



<h2 id="h-5-pay-quarterly-estimated-taxes">5. Pay Quarterly Estimated Taxes</h2>



<p>Entrepreneurship has many rewards, such as creative freedom over business decisions and the ability to set your schedule.&nbsp;</p>



<p>The tradeoff for freedom is the additional work required to ensure accuracy for the business’s <a class="link" href="https://1800accountant.com/services/quarterly-estimated-taxes">quarterly estimated tax payments</a>. An online CPA can handle your <a class="link" href="https://1800accountant.com/services/industry/freelancer-self-employed">self-employed tax filing</a> and allow you to focus on other important goals, like growth and expansion. Using a CPA will also ensure compliance and minimize your tax liabilities.</p>



<h2 id="h-turn-to-the-experts-for-year-round-tax-advisory">Turn to the Experts for Year-Round Tax Advisory</h2>



<p>There you have it! These are the five small business accounting basics every new entrepreneur should know. Whether you have a background in accounting or are entirely new to business taxes, you must stay on top of your business’s accounting and taxes.&nbsp;</p>



<p>Small business owners often stretch themselves thin trying to juggle their various responsibilities. One thing worth removing from your plate is accounting. The tax experts at 1-800Accountant provide tailored advice with unlimited support, a dedicated accountant, and transparent pricing. Learn more about our <a class="link" href="https://1800accountant.com/services/small-business-taxes">year-round tax advisory services</a> to see what we can do for your business.&nbsp;</p>

Starting a business can be equally exciting and stressful. Before you can get your business up and running, there’s much to consider regarding small business accounting and taxes. Ideally, a CPA (certified public accountant) tax accountant could handle everything from the initial EIN filing to business tax preparation on your behalf, so you can focus [&hellip;]

Two separate binders labeled assets and liabilities.

entrepreneurs-need-know-accounting

5 Things Entrepreneurs Need to Know About Small Business Accounting

Nothing may be more rewarding than laboring all day to clean up a messy house and then seeing how sparkling and new it looks after this hard work. While house cleaning service providers may get this nice dose of satisfaction, they are still like all self-employed professionals who get hit with countless taxes and IRS regulations.

<span style="font-weight: 400;">In this article, we'll discuss </span><a class="link" href="https://1800accountant.com/services/industry/freelancer-self-employed"><span style="font-weight: 400;">self-employed house cleaner tax deductions</span></a><span style="font-weight: 400;"> and offer tax tips for </span><span style="font-weight: 400;">independent contractors</span><span style="font-weight: 400;">. </span>So, to ease the tax burden, here are some key expenses you may be eligible to write off on your IRS income tax return if you’re a housekeeper working for yourself.
<h2>Self-Employment Tax Deduction</h2>
<span style="font-weight: 400;">Self-employment taxes are the taxes an independent contractor or self-employed individual pays to the federal government for Medicare and </span><span style="font-weight: 400;">Social Security</span><span style="font-weight: 400;">.</span> <span style="font-weight: 400;">The </span><span style="font-weight: 400;">self-employment tax</span><span style="font-weight: 400;"> rate is 15.3%—12.4% for </span><span style="font-weight: 400;">Social Security tax</span><span style="font-weight: 400;"> and 2.9% for </span><span style="font-weight: 400;">Medicare tax (hospital insurance)</span><span style="font-weight: 400;">.</span>

<span style="font-weight: 400;">Learn more about </span><span style="font-weight: 400;">self-employment tax deductions</span><span style="font-weight: 400;"> and other commonly missed </span><a class="link" href="https://1800accountant.com/blog/missed-deductions-freelancers"><span style="font-weight: 400;">freelance tax deductions</span></a><span style="font-weight: 400;">.</span>
<h2>Top 5 Tax Deductions for Self-Employed Housekeepers</h2>
<h3>Housekeeping supplies</h3>
<span style="font-weight: 400;">You may not think the Windex you use for your </span><span style="font-weight: 400;">house cleaning business</span><span style="font-weight: 400;"> would qualify as an </span><span style="font-weight: 400;">expense</span><span style="font-weight: 400;"> write-off, but it is. </span>The expenses you incur to purchase or replace cleaning supplies you need to conduct your home cleaning service are tax deductible. Examples may include:
<ul>
 	<li>Vacuums, dust busters, etc.</li>
 	<li>Solvents</li>
 	<li>Soap</li>
 	<li>Towels or rags</li>
 	<li>Gloves</li>
 	<li>Windex and other cleaners</li>
 	<li>Mops</li>
 	<li>Brooms</li>
 	<li>Sponges</li>
 	<li>Buckets or containers</li>
 	<li>Trash bags</li>
 	<li>Bags to carry your cleaning supplies</li>
 	<li>Uniforms</li>
</ul>
<h3>Vehicle and travel expenses</h3>
If you drive a personal vehicle from one worksite to another, you can claim a portion of your vehicle expenses as a business tax deduction for your housekeeping work. There are two ways you can take advantage of this write-off – either claiming the mileage you drive or claiming actual vehicle expenses.

<a class="link" href="https://www.irs.gov/newsroom/irs-increases-mileage-rate-for-remainder-of-2022" target="_blank" rel="noopener">Per the IRS</a>, the standard mileage deduction rate for the first 6 months of 2022 is 58.5 cents per mile. This then increases to 62.5 cents per mile for the final 6 months of 2022,  so you can deduct this amount for any business-related trips you’ve made – but only when going from one location where you are cleaning to another. You cannot deduct your trip from home to a worksite or vice versa.

Per the IRS, in 2023, the standard mileage deduction rate has increased to 65.5 cents per mile driven for business use.

The other option is to write off the actual expenses you incur on your vehicle. In other words, you can claim a percentage of all vehicle expenses you incur and deduct this portion you pay for your housekeeping labor. These may include:
<ul>
 	<li>Gas</li>
 	<li>Vehicle insurance</li>
 	<li>Maintenance</li>
 	<li>Lease payments</li>
 	<li>Depreciation</li>
</ul>
Any tolls or parking fees you may incur in some commercial or residential areas can be written off on your IRS return as well.

Of course, if you travel to different job sites in a day via public transit or Uber, these costs can also be deducted as business-related travel expenses. Just remember that you can’t include your commutes in this deduction.
<h3>Phone expenses</h3>
If you use your personal cell phone or a landline in your home to make housekeeping arrangements with your clients, you can write off a portion of your phone bill as business expenditure. Just be sure to accurately estimate what percentage of time you spend on the phone is for your cleaning work and what percentage is for personal use.
<h3>Marketing costs</h3>
Any marketing-related expenses you incur to help promote your housekeeping services are tax deductible in the eyes of the IRS. Such expenses may include brochures, flyers, a website, social media marketing, or even a mobile app for your clients to schedule their cleaning appointments with you.

If you hire a contractor to provide marketing materials for you, this cost is also deductible.
<h3>Insurance for your housekeeping business</h3>
Being a business owner can be risky from a liability standpoint, so be sure you are properly insured. The good news is that your business insurance premiums can be claimed as a write-off. You may choose to invest in liability insurance, property insurance, and other policies based on your specific situation.
<h2>Work with tax professionals to help you save</h2>
Looking for more ways to save money in your housekeeping business? Reach out to our tax professionals who have expertise in <a class="link" href="https://1800accountant.com/services/industry/freelancer-self-employed">saving money for house cleaners who are self-employed</a>.

Nothing may be more rewarding than laboring all day to clean up a messy house and then seeing how sparkling and new it looks after this hard work. While house cleaning service providers may get this nice dose of satisfaction, they are still like all self-employed professionals who get hit with countless taxes and IRS [&hellip;]

A young self employed house cleaner closing the blinds to keep the sunlight out.

paid-housekeeper

Self-Employed House Cleaner Tax Deductions

<p>As a small business owner, you should never overlook your accounting needs. Learning the financial accounting basics is essential, regardless of industry or entity type.&nbsp;</p>



<p>There are accounting basics and terms which are helpful to know as your small business develops and can help you understand the most critical financial concepts. Here are the financial accounting basics that our team here at 1-800Accountant thinks every small business owner should know.&nbsp;</p>



<h2 id="h-accounting-terms-small-business-owners-need-to-know">Accounting Terms Small Business Owners Need to Know</h2>



<p>Before we dive in, here are a few important accounting terms for you to know:&nbsp;</p>



<h3 id="h-bookkeeping"><strong>Bookkeeping</strong></h3>



<p>Bookkeeping comprises tracking all transactions that a business does, using single-entry bookkeeping or double-entry bookkeeping. You can learn more about <a class="link" href="https://1800accountant.com/blog/small-business-bookkeeping">bookkeeping for small businesses</a> with this helpful guide.</p>



<h3 id="h-ledger"><strong>Ledger</strong></h3>



<p>A general ledger contains transaction information needed to form a balance sheet and an income statement. Find more information about <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-what-is-a-general-ledger">what a general ledger is</a> here.</p>



<h3 id="h-trial-balance"><strong>Trial Balance</strong></h3>



<p>A trial balance contains every general ledger account and its balance, arranged by debit and credit columns.</p>



<h3 id="h-income-statement"><strong>Income Statement</strong></h3>



<p>An income statement shows small business expenses and revenue.</p>



<h3 id="h-balance-sheet"><strong>Balance sheet</strong></h3>



<p>A balance sheet shows small business assets, equity, and liabilities.</p>



<h2 id="h-financial-accounting-basics-for-small-business-owners">Financial Accounting Basics for Small Business Owners&nbsp;</h2>



<p>There are three crucial financial accounting basics that we’ll cover today: the two accounting methods, how to use a balance sheet, and how to produce an income statement.</p>



<p>When it comes to running your small business, understanding the <a class="link" href="https://1800accountant.com/blog/small-business-accounting-cash-vs-accrual">differences between the accrual and cash accounting</a> methods can prove to be a huge advantage.&nbsp;</p>



<p>Using the accrual accounting method, you'll record expenses and revenue whenever a transaction occurs. You'll record expenses when paid, and you'll record revenue when earned.</p>



<p>If you use the cash accounting method, you'll record expenses and revenue differently. You'll record expenses when your small business pays an expense, and you'll track revenue when your small business receives cash.</p>



<h2 id="h-what-is-a-balance-sheet">What Is a Balance Sheet?&nbsp;</h2>



<p>A <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-what-is-a-balance-sheet">balance sheet</a> summarizes three pieces of financial data:&nbsp;</p>



<ul>
<li>Assets&nbsp;</li>



<li>Expenses</li>



<li>Liabilities&nbsp;</li>
</ul>



<p>Assets, liabilities, and equity make up your balance sheet, but each individual account also provides useful information.&nbsp;</p>



<p>Assets describe what your company owns and can describe equipment, items, and property. On the balance sheet, you'll list your assets on the left side.&nbsp;</p>



<p>Assets break down into current assets and noncurrent assets. Current assets refer to assets that you'll use within one year. There are multiple current assets you may categorize, including:</p>



<ul>
<li>Accounts receivable</li>



<li>Cash and cash equivalents</li>



<li>Inventory</li>
</ul>



<p>Long-term assets refer to assets that you won't use within one year. These assets are what you'll hold on to for several years and can include:</p>



<ul>
<li>Fixed assets</li>



<li>Intangible assets</li>



<li>Long-term investments</li>
</ul>



<p>Expenses are costs a business pays to earn its revenue. There are two types of expenses:&nbsp;</p>



<ul>
<li><strong>Operating expenses: </strong>expenses related to company operations, such as administrative fees and rent.&nbsp;</li>



<li><strong>Non-operating expenses: </strong>expenses not from operations, such as costs of borrowing money or interest charges.</li>
</ul>



<p>Liabilities are the expenses that a business owes to others. Examples of liabilities for small businesses are monthly bills, rental costs, and salaries to your employees. Similar to assets, there are two types of liabilities: current and long-term.&nbsp;</p>



<p>Current liabilities are liabilities due within the current fiscal year. You'll arrange these liabilities in the order of their due date. Current liabilities could include:</p>



<ul>
<li>Accounts payable</li>



<li>Current portion of long-term debt</li>



<li>Interest payable</li>



<li>Loans</li>



<li>Payroll</li>



<li>Wages payable</li>
</ul>



<p>Long-term liabilities are liabilities due beyond the current fiscal year. These include:</p>



<ul>
<li>Deferred tax liability</li>



<li>Long-term debt</li>



<li>Pension fund liability</li>
</ul>



<h2 id="h-what-is-an-income-statement">What Is an Income Statement?&nbsp;</h2>



<p>The <a class="link" href="https://1800accountant.com/blog/bookkeeping-101-what-is-an-income-statement">income statement</a> summarizes your equity and revenue.&nbsp;</p>



<p><strong>Equity</strong>, the net worth of your small business, remains after you deduct assets from liabilities. You'll list your equity and liability on the right side of the balance sheet.</p>



<p><strong>Revenue</strong> is income that comes from business operations. There are two types of revenue: operating and non-operating revenue. Operating revenue comes from small business sales of products or services.&nbsp;</p>



<p>Non-operating revenue is revenue that comes from secondary sources. Examples of non-operating revenue include donations, rental income, or royalties.</p>



<h2 id="h-an-online-accountant-can-handle-the-basics-for-you">An Online Accountant Can Handle the Basics for You</h2>



<p>As a small business owner, learning the accounting basics provides a great platform for small business success. Learning the basics can also help you should you ever need to work with an online accountant.<br>When your business requires an online accountant, turn to professionals. Work with an online accountant at 1-800Accountant for your <a class="link" href="https://1800accountant.com/services/small-business-taxes">small business accounting needs.</a></p>

As a small business owner, you should never overlook your accounting needs. Learning the financial accounting basics is essential, regardless of industry or entity type.&nbsp; There are accounting basics and terms which are helpful to know as your small business develops and can help you understand the most critical financial concepts. Here are the financial [&hellip;]

Must know accounting basics for small businesses.

accounting-basics-for-small-businesses

Accounting Basics for Small Businesses

<p>As a small business owner, you’re accustomed to wearing many hats. It takes a lot of energy and resources to keep your business running smoothly. Small business accounting is a lot to take on for a single person. It can quickly become overwhelming when you consider complex needs for filing taxes, processing payroll, and day-to-day accounts receivable. When you <a class="link" href="https://1800accountant.com/blog/5-reasons-hire-accountant-help-small-business-taxes-year">outsource accounting</a> duties to an external firm, it helps ensure your business is set up to thrive.</p><p>In today’s digital world, it’s easier than ever to find an online accountant who can work with you remotely. Here are <strong>5 signs it’s time to outsource accounting for your small business</strong>.</p><h2 id="h-5-signs-it-s-time-to-outsource-accounting-for-your-small-business">5 Signs It's Time to Outsource Accounting for Your Small Business</h2><h3 id="h-1-in-house-accounting-takes-up-too-many-resources">1. In-house Accounting Takes Up Too Many Resources</h3><p>While large organizations are usually fully equipped with an in-house accounting team, smaller businesses may not have this luxury. However, just because your business is small doesn’t mean the workload is easy. Maybe you’re a new business owner trying to figure out <a class="link" href="https://1800accountant.com/blog/pay-yourself-small-business-owner">how to pay your own salary</a>. Or, you simply can’t quite get a handle on <a class="link" href="https://1800accountant.com/blog/bookkeeping-vs-accounting">the difference between bookkeeping and accounting</a>.&nbsp;</p><p>Working through all the accounting needs of a small business requires many resources, both in time and finances. If you or an employee are spending countless hours on accounting duties like payroll, business taxes and accounts payable, it might be worth considering how outsourcing can help ease your burdens. Utilizing enrolled agents within a cloud-based accounting firm will free up time that can be better spent on other significant areas of your business.</p><h3 id="h-2-you-re-experiencing-delayed-payroll">2. You’re Experiencing Delayed Payroll</h3><p>Employees are a vital resource to any small business, so it’s critical that <a class="link" href="https://1800accountant.com/blog/small-business-payroll">payroll is processed without delay</a>. Payroll often includes nuances such as health insurance, workers’ compensation, and 401(k) deductions, not to mention time tracking, sick leave, and PTO. There are certain <a class="link" href="https://1800accountant.com/blog/make-payroll-more-efficient">practices to keep payroll efficient</a>, but even the most well-intentioned business owner can fall behind when payroll is done in-house.</p><p>As priorities shift and unexpected events occur, there’s always a risk of something falling off the radar. If you’re struggling to keep track of the details and have delayed payroll, it may be time to consider <a class="link" href="https://1800accountant.com/services/bookkeeping">outsourced bookkeeping</a>. In addition to processing payroll, bookkeepers can offer a <a class="link" href="https://1800accountant.com/blog/crucial-things-bookkeepers-do">valuable set of skills</a> that keep your finances on track.</p><h3 id="h-3-your-business-is-growing-too-fast-to-keep-up-with-its-accounting-needs">3. Your Business Is Growing Too Fast to Keep Up with Its Accounting Needs</h3><p>Let’s say you’ve committed to a plan of <a class="link" href="https://1800accountant.com/blog/grow-small-business">growing your business</a> over the past couple of years, and you’ve found success! A fast-growing business is far from a problem unless your accounting duties start to fall behind. As a business increases revenue, other needs will emerge. These could include hiring additional <a class="link" href="https://1800accountant.com/blog/employee-vs-contractor">employees or contractors</a> and processing more financial records.&nbsp;</p><p>If you’ve decided to offer new products or services, you’ll probably be dealing with new vendors as well. Filing your business taxes and state taxes can take more effort when your business is experiencing rapid growth. Unless you have the resources to maintain your finances, you risk missing key details or making errors on tax returns. Outsourcing accounting needs can give you peace of mind as your business grows.</p><h3 id="h-4-accounting-records-take-up-too-much-space">4. Accounting Records Take Up Too Much Space</h3><p>Tax forms, invoices, payroll records, and other financial documents can quickly pile up for a small business owner. It’s not always easy to know what you need to keep and what you can toss. This is especially true when there’s a possibility of <a class="link" href="https://1800accountant.com/blog/you-received-an-audit-notice-now-what">receiving an audit notice</a>. Even if your accounting records are mostly digital, they still require space you may not have.&nbsp;</p><p>Cloud-based storage and tax software are valuable tools that can be utilized by outsourcing to an accounting firm. A dedicated accounting company will have the necessary storage to keep all of your records in a safe space. When you outsource accounting, do it with the confidence that your financial documents will be available when you need them.&nbsp;</p><h3 id="h-5-your-small-business-tax-needs-have-grown-more-complex">5. Your Small Business Tax Needs Have Grown More Complex</h3><p>It may be tempting to take a DIY approach to tax preparation, especially considering that the IRS offers free federal tax filing. However, this approach can be time-consuming if your small business taxes have several unique variables. For example, small business owners should be aware of <a class="link" href="https://1800accountant.com/blog/small-business-tax-deductions-checklist">expenses they can deduct</a> and <a class="link" href="https://1800accountant.com/blog/small-businesses-quarterly-taxes" target="_self">quarterly tax payments</a>.&nbsp;</p><p>It can be challenging to sort through all the complex details, especially if your business has gone through any significant changes over the past year. Industry experts thoroughly review tax returns to ensure accuracy and completion.</p><h2 id="h-turn-to-online-cpas-for-fast-and-accurate-accounting">Turn to Online CPAs for Fast and Accurate Accounting</h2><p>When the time comes for your small business tax return preparation or basic accounting needs, it’s best to trust a team of industry experts. Start by understanding some key facts about tax professionals such as the representation rights of CPAs, enrolled agents, and participants in the IRS <a class="link" href="https://www.irs.gov/tax-professionals/annual-filing-season-program" target="_blank" rel="noreferrer noopener">Annual Filing Season Program</a>.&nbsp;</p><p>The team at 1-800Accountant is specially dedicated to serving small business owners with decades of financial expertise. Our services include <a class="link" href="https://1800accountant.com/services/entity-formation">new business registry</a>, <a class="link" href="https://1800accountant.com/services/bookkeeping">bookkeeping</a>, <a class="link" href="https://1800accountant.com/services/payroll">payroll</a>, and a comprehensive portfolio of <a class="link" href="https://1800accountant.com/services/small-business-taxes">business tax services</a>. Small business taxes don’t have to be a struggle when you partner with the right team who are experts in the industry.&nbsp;</p><p>Secure, cloud-based storage, a convenient mobile and web portal, and year-round advisory are just some of the benefits you’ll receive when choosing 1-800Accountant. Contact a tax professional today and find out how they can help streamline your business accounting processes.</p>

As a small business owner, you’re accustomed to wearing many hats. It takes a lot of energy and resources to keep your business running smoothly. Small business accounting is a lot to take on for a single person. It can quickly become overwhelming when you consider complex needs for filing taxes, processing payroll, and day-to-day [&hellip;]

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How to Know It&#8217;s Time for Your Small Business to Outsource Accounting

How to Know It's Time for Your Small Business to Outsource Accounting

<p>Petty cash can cause difficulties with <a class="link" href="https://1800accountant.com/blog/business-expense-tracking-guide">small business expense tracking</a>. This article blog discusses common issues from manual handling to fraud, offering to manage expenses. Keep reading as we introduce a game-changing solution to streamline your financial operations, improve control, and reduce the risk of fraud. Don't let small expenses become bigger problems.</p><p>Here are some common problems small businesses run into when using petty cash.&nbsp;</p><h2 id="h-manual-processes">Manual Processes</h2><p>Your employees need petty cash to make necessary outside purchases. However, it is not a simple process to gain access to the actual cash. Employees have to request cash, usually by filling out a form. They have to keep it separate from their own cash and make sure their business and personal expenses don’t intermingle. After making the purchase, they need to get change and a receipt. Then, they need to hold on to both until they can fill out an expense report. This process has plenty of room for error.</p><h2 id="h-fraud">Fraud</h2><p>Keeping cash around in a business always comes with a high degree of risk. Petty cash logs need to be maintained by someone, and usually, while that cash is supposed to be “petty” — used in small amounts, the more petty cash transactions you have outside the office, the less petty — and less manageable — it gets. Managers may have trouble controlling how petty cash is spent, leading to overspending or misappropriation of funds.</p><h2 id="h-accounting-with-cash">Accounting with cash</h2><p>Your finance department must spend precious time and resources tracking and matching receipts for all cash transactions. They also must maintain budgets that now have a cash drain since more than projected was used to cover expenses in the field. As your business scales up, these problems only grow more pronounced.&nbsp;</p><h2 id="h-a-better-solution-for-petty-cash">A Better Solution for Petty Cash</h2><p>Eliminate the burden of cash with a simple prepaid business card. PEX prepaid cards offer each employee spending freedom. Yet, managers can control every cent that gets spent by specifying maximum expense amounts, types of acceptable expenses, and acceptable places to spend.&nbsp;&nbsp;</p><p>Gain control of your budgets and expenses by funding cards by individual employee functions, customers, locations, or the time of day.&nbsp; The PEX platform can track expense information for each employee and allocate new funds 24/7, wherever they are in the field.</p><p>With one simple change, you can get unprecedented control over your expenses, eliminating inefficiencies, and sharply reducing mistakes and fraudulent spending. You'll also relieve your employees of annoying paperwork and burdensome manual procedures.</p><p>To learn more about special pricing for 1-800Accountant clients, head to PEX.</p>

Petty cash can cause difficulties with small business expense tracking. This article blog discusses common issues from manual handling to fraud, offering to manage expenses. Keep reading as we introduce a game-changing solution to streamline your financial operations, improve control, and reduce the risk of fraud. Don&#8217;t let small expenses become bigger problems. Here are [&hellip;]

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The Problem with Petty Cash

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<p>“Excellent first call, very informative. This is my third business … this time  I will ease the burden and use 1-800Accountant [for accounting]”</p>

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