- Understanding Your Cash Flow
- Determining Your Family's Income Needs
- Emergency Funds
- Business Cash Flow
- Common Expenses to Keep Track Of
- Prepare Daily, Monthly, and Annual Records
- Profit and Loss Statement
- How Long to Keep Business Records
- Finding Someone to Do Your Paperwork
- Budgeting for Your First-Year Costs
If you find you have no patience with record-keeping, then hire someone to do it for you. The important thing to keep in mind is that you must maintain up-to-date and accurate records in order to avoid hassles with the IRS and to manage and operate your business successfully. You can hire a bookkeeper or a bookkeeping service to maintain your records. Accounting services can help the owner keep the business on a sound basis. Among these services are setting up record-keeping procedures and maintaining the bookkeeping records. In addition to bookkeeping services, you may need the services of a tax professional, such as a certified public accountant (CPA).
Think seriously about hiring a tax professional. You want to do things right and be able to take advantage of all your tax saving opportunities. A tax professional can provide financial advice based on the interpretation of the records, and file tax returns. In addition, a professional can advise on cash requirements, budget forecast, borrowing, business organization, and taxes.
How Do You Find a Tax Professional When You Need One?
You want someone who has credentials: a state license or professional certificate to do business. They should have a bachelor's degree and possibly an advanced degree. If you go to their office or home, you'll usually see their diplomas and certificates posted. If not, ask them directly or check with your state. Most professions have state associations. For example, the CPA society is for accountants. As usual, also ask people whose business sense you respect for their recommendation. People who have had a good experience with a professional will probably want to recommend that person. Choose professionals experienced in the work you want done.
Questions to Ask a Potential Accountant
- Do you have your CPA certification?
- Are you experienced in the area of my business?
- Do you charge by the job or by the hour? What is your hourly rate? (Steer clear of a tax preparer that charges you based on your income.)
- How many hours do you estimate the job will take?
- Will you put your fees and other things we discussed in writing?
- May I have the names of some of your clients to call for references? (Be sure to call these clients. A satisfied customer is always a good reference.)
- What are your hours and your availability? (Will you be able to get through to this person when you need him or her? Will your tax professional be available all through the year, or is it just a part-time extra money–maker during the tax season? You may want some tax planning in October to make tax preparation in April a little more profitable for you.)
Accept a free first consultation if it is offered. It is a good chance to see if you get along with the professional and his/her style. If they interrupt your session to take phone calls every three minutes, leave after the third interruption. All their qualifications mean little if they won't focus on you.
You also want a person who has a professional attitude about client confidentiality. If he or she keeps telling you about other people's business, keep in mind they may divulge your personal information to others. If he or she just gives examples, then that's OK. Ask for a written agreement and a fee schedule. An accountant or tax preparer should not hesitate to give this to you.
Ask for referrals. You want the names and phone numbers of three of their satisfied clients. Satisfied clients should be willing to tell you good things about the job that person did for them.