Why do I need to hire an accounting company?
As your business grows, it becomes harder to save time on accounting, bookkeeping, taxes, and payments. Just preparing your taxes demands many steps that can be finalized a lot more smoothly when one is already familiar with the process. While an in-house accountant might take some of these tasks off your plate, an accounting company might offer a real chance of improving the overall management of your financial data through a wider variety of resources.
You must consider the qualifications amassed by the accounting company in their professional experience, looking at how well-established their services are in the local industry. Accessibility is also a must: the accounting services you hire must be adapted to the needs of your business, so the accountants must be versatile in their methods and receptive to your input. A reliable network of communication also helps safeguard a long-lasting working relationship.
What is the difference between a bookkeeper and an accountant?
In any business, bookkeeping and accounting go hand in hand. Bookkeepers collect and classify all the financial data while accountant evaluate it to help the company complete different procedures and implement new plans. When they conduct their work appropriately, bookkeepers and accountants complement each other to finalize your company's goals.
What's the best way to separate my business and personal finances?
It's important to track where your money comes from, especially if you have a start-up business and still haven't set boundaries to separate it from the profits you make in other areas of your personal life. To avoid hassle during tax planning and a potential fine by the IRS, you might want to start setting separate checking accounts with the corresponding accounting systems. Set a budget for your business to regulate your expenses and get a business credit card to keep the financial history of your business separate from your personal dealings. Collecting your personal and business receipts in different locations also helps.
Since both your business and personal accounts are probably used by other people (family members, business associates, employees), it's important that all parties involved also take part in keeping this distinction, following all the tips described above and knowing the limitations of the budget at their disposal.
What should I know about setting up an accounting system for my business?
Even if you or a member of your staff has the time to go through your accounting manually, an accounting software managing your financial data is the best way to remove all chances of mistake. QuickBooks and Creative Solutions Accounting are recommended options with proven results. While the staff ad United Tax Group is fully acquainted with these systems, we are nonetheless open to introduce new tools and adapt our technologies to our clients' requirements.
Which records must be tracked during bookkeeping?
Your company's records must reflect all the income earned and the expenses made by your business. Depending on the nature of your business and the services you provide, this also entails an evaluation of the company's performance in the market and with costumers on a daily basis.
What goes into outsourcing my payroll?
After your provide your staff basic information concerning salaries, commissions, bonuses and deductions, the company takes care of processing payments electronically. Payrolls are automatically calculated and scheduled, processed either via deposits or checks depending on the paying methods established by your company.
What goes into paying my taxes?
Taxes must be estimated and paid by April 15, so federal institutions, banks and employers usually provide the necessary documents to estimate your tax rate by late January. To calculate your taxes, you need a copy of your last year's tax return, written statements showing your income (W-2 and 1099 forms reporting your standard earnings and additional income), receipts to verify any deductions you want to claim, and records of deductible contributions you've made to health savings/retirement accounts. Your last year's tax return is also necessary and a useful point of reference to verify that your information is in order.
Choose with a tax preparer and verify that they have aw a Preparer Tax Identification Number (PTIN). It's important to schedule your appointment with the tax preparer in advance to have enough time to go through all relevant records and calculate all interests, dividends and deductible contributions.
What are business taxes?
They are taxes allotted for business owners in relation to the type of business they run, the services/products they provide, their assets and investment. There are 5 types of business taxes listed by the IRS:
- Income taxes: determined by the profits made by your business.
- Estimated taxes: It's the percentage that's withheld from an employee's paycheck.
- Employment taxes: Taxes you must pay on behalf of your staff. They cover federal unemployment taxes, as well as Social Security and Medicare taxes.
- Self-employment taxes: Taxes required for independent workers making more than $400 per year.
- Excise tax: Allotted to business owners dealing with alcohol, cigarettes, fuel, and the like.
While both large companies and start-up businesses must pay for taxes according to their income and expenses, taxes are calculated differently in each case.
What's the difference between tax deduction and tax credit?
Tax credits reduce the total sum in your tax bill. Tax deductions are taken from your taxable income before you know the tax rate you must pay. Taxable income refers to the money that's added to your tax rates in relation to the profits and earnings you've made throughout the year.
There are different tax credits to help students, parents, people with low income, and other circumstances that might require financial support. Meanwhile, you can either claim a standard tax deduction or claim itemized deductions corresponding to special expenses that you must list on your tax return. As of 2020, standard deductions are of $12,400 for single independent filers and $24,800 for joint filers. Credits and deductions can change your tax rates considerably, but you should get the assistance of a professional accountant to help you go through all your expenses and see what can be used. You can always contact United Tax Group to get in-depth information about all the credits and deductions you can take into account for your taxes.
Hiring professional accounting services, what should I expect in terms of pricing?
Accountants can simultaneously different tasks, either for your personal or corporate finances. Because of this, pricing can vary considerably for one accountant to the next depending on your requirements. At United Tax Group, we strive to remain an accessible alternative for all types of clients, so we offer the most competitive and affordable rates in the industry, adapting our services to your limitations and allowing different options when it comes to deadlines and forms of payment.