Organized Finances Ensure Business Success

English: Findlay, Ohio, September 20, 2007 -- ...
English: Findlay, Ohio, September 20, 2007 — Gilbert Yingling, a representative with Small Business Administration (SBA) makes calls to local business owners from a local chamber of commerce business directory as part of an SBA outreach program. He then follows up with person to person meetings with the business owners. John Ficara/FEMA (Photo credit: Wikipedia)

It is important for any business to keep its finances in order. Numerous websites stress this, such as the Scott Reiman crunchbase profile. Having organized finances ensures that business owners will always be able to know where their businesses stand and whether or not they are incurring profits or losses. If they are incurring losses, then they might need to reevaluate their business structure and marketing tactics and change them to find a more effective solution that works. It is also important for businesses to have their finances in order for tax purposes as well. There are a few tips that business owners can keep in mind to help keep their business’s finances organized.

Retain a CPA

Retain the services of a certified public accountant. Accountants are one of the most important resources that a business can have. Accountants are skilled in ensuring that finances are in proper order. They are also invaluable to helping business owners make informed decisions concerning their businesses. Accountants can generate virtually any type of business report that owners need to determine where their business stands in the way of successfulness.

Re-evaluate Business Entity

Many business owners begin their businesses as sole proprietorships or partnerships. However, over time and with expansion, it might be ideal for them to incorporate their businesses or form an LLC that can help shelter them from financial risks. Incorporating a business entity or forming an LLC can also help business owners save money on their taxes. Additionally, failing to adjust a business’s entity to accommodate a different income level could end up being a costly mistake. Business owners might want to discuss their different entity options with a CPA so that they can determine the right entities for their businesses and the appropriate times to make any changes, if necessary.

Review Estimated Tax Payments

Business owners have to pay estimated tax payments, which are quarterly payments. Underestimating estimated tax payments can result in penalties for businesses, so when estimating estimated tax payments, round up rather than down. It is better to overpay than to underpay because anything that is overpaid will be returned back the business in the long run when tax refund time rolls around. By properly estimating taxes, business owners can prevent underpaying and overpaying, though. Reviewing what the business has earned year to date and then projecting what it is expected to earn throughout the rest of the year is how estimated taxes are discerned.

Keep Business and Personal Finances Separate

One of the most important rules to managing business finances is to keep them separate from any personal finances. Although this is not mandatory for sole proprietorships, it is mandatory for corporations or LLCs. It is still a good practice for all business owners to employ, though. Open up separate accounts strictly for the business that are separate from any personal accounts. Likewise, have debit cards that are solely for the business as well. It is also a good idea to open up a dedicated savings account or money market account where approximately 25 percent of each check can be transferred to save for estimated tax payments.

No matter whether a business is large or small, keeping its finances properly maintained is essential to appropriate business operation.

Tax Season Dates And Tips

The new tax season is approaching quickly, and now is the time to get helpful information about state and federal tax filing.

The recent government shutdown prompted the Internal Revenue Service to delay federal income tax processing until the end of January 2013. Income tax agents may complete your return prior to January 31st, but they will have to hold onto it until the 31st.

Federal refunds should still be received within three weeks if filed electronically and within eight weeks for paper returns. TurboTax 2014 may be a great resource to help you get ready no matter how you end up filing your 2013 or 2014 taxes.

State tax processing is scheduled to begin on January 22nd and 23rd, with a processing window of four to twelve days. Electronic processing may occur within four days, and paper returns may be processed within eight to twelve days. You still have the option of receiving a physical check or a direct deposit, but the electronic filing and direct deposit options may speed up the entire process for you. You may be anxious to file your taxes, but a good review with TurboTax 2014 may result in more savings than you ever imagined.