There’s no doubt that entrepreneurs and small business owners are often considered experts within their individual industries. I mean, that is why you started your business, right? Because it allows you to operate in your zone of genius and nobody else can do what you do the way you do it? But for nearly every creative, there’s one area of business that is so far from their zone of genius that they avoid it at all costs – it’s the accounting and tax part *cue the shrieks and eerie music*. An RBC Ventures poll found that two-thirds (66%) of small business owners say they haven’t taken advantage of tax benefits they may be entitled to. Two-thirds also say they find filing their company taxes to be confusing. ASE Group is here to tell you that it doesn’t have to be!
Hire a Professional CPA One of the more obvious tips is to hire a professional CPA to manage your business’ accounting needs. Choosing an accountant for yourself or your business is a decision that should not be taken lightly. Accountants are privy to sensitive financial information, which makes it all the more vital that you trust and respect them. Do your research and prepare a list of questions to ask them. Start (and potentially end) your journey to finding your next CPA by meeting with the trained professionals at ASE Group! You’re not just a number here. Our business model is to service fewer clients in more areas of their business. We only work in areas that we’re experts in, and we work very well with new and growing business owners, and individuals with passive income from rental property. We take our time and explain things to you like a business professional speaks to another business professional (not CPA to non-CPA). And we always start with you in mind -- how can we make your business better? How can we solve your tax problem? How can we help you sleep better with more peace of mind that your accounting and tax matters are in good hands?
Separate Business & Personal Finances
You and your business are a separate entity, so it’s best to keep your business and personal banking separate. It makes it much easier to determine what expenses during the year were related to your business when business transactions are not commingled with personal transactions.
Review Your Business Structure What is the structure of your business? Are you a sole proprietor, S-Corp, LLC, Partnership or C-Corp? ⠀⠀⠀⠀⠀⠀⠀⠀⠀
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One thing business owners may not realize is that as your business and income grow, you may want to consider changing the structure of your business to maximize benefits and earning potential. This is something you should review with your CPA every few years (more often if your business is growing rapidly or if there have been changes to the ownership).⠀⠀⠀
Don’t Assume You Are Taking Too Many Deductions
If your business deductions exceed your business income, you have a tax loss for the year. With a few modifications to the loss, tax law calls this a “net operating loss,” or NOL.
If you are just starting your business, you could very possibly have an NOL. You could have a loss year even with an ongoing, successful business. And if you toss a pandemic on top of it, a loss year is extremely plausible.
We’re happy to evaluate your business, its performance over the past 3 years and the tax-saving strategies that would benefit you the most. Let us help you stay sane, and save your cents and sense.