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.

Factors To Consider When Looking For Phoenix Bankruptcy Lawyers

English: Virginia bankruptcy attorney Robert W...
English: Virginia bankruptcy attorney Robert Weed discusses bankruptcy and foreclosures. (Photo credit: Wikipedia)

Phoenix Bankruptcy Lawyers

When you are no longer able to continue servicing your debts, and the only option seems to be bankruptcy, you need to find Phoenix bankruptcy lawyers who can help you file the necessary paperwork. Depending on your individual financial condition, you can apply for either the chapter 7 or 13 bankruptcy. If you are not sure about which chapter is best suited for your unique circumstance, be sure to ask a bankruptcy attorney for advice.

How Bankruptcy Can Help You

When the court declares you bankrupt, your creditors will not be able to come after you. The threatening emails and notices will stop. A bankruptcy can also help you prevent the bank from repossessing your home if your mortgage is in default. In the chapter 13, all creditors including mortgage companies and credit card firms are repaid according to the court approved repayment plan. As long as you continue making regular payments, you can own the house.

Effects of Bankruptcy

Lenders will report you to credit reference bureaus once you file bankruptcy. This will affect your credit score thereby preventing you from accessing cheap loans from lenders. A poor credit score will also prevent you from renting a house, leasing a car and many other things.

Before you start filling bankruptcy-related forms, you must speak to competent Phoenix bankruptcy lawyers like those working for Frutkin Law Firm or Thomas Law Office. These professionals can help you to make an informed decision.