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Top 10 Useful Tax Saving Tips For Small Businesses

January 23, 2023 admin

Managing the expenses efficiently and accurately is a hectic task for the small business owners. However, proper expense management is the key to profitability and sustainability for businesses. Inevitably, there are thousands of ways to reduce expenses. However, among all, tax saving is the most effective one that keeps businesses alive in the market. In case you are wondering how can a small business reduce taxes, then there are many tax-saving strategies for business owners. Follow our best tax saving tips for small businesses owners to save your hard-earned money.

What are the Best Business Tax Savings Ideas to Follow

Wondering how small businesses can save on taxes & tax saving tips for small businesses? Do follow our income tax saving tips for 2023 USA and learn more.

Record All Your Business Expenses
Take Advantage of Having a Child
Avoid Penalties from Late Payments
Avoid Capital gains
Learn about 401 (K) and W4 Forms
Contribute to Retirement Account
Add money to 529 Account
Contribute to Different Schemes/Charity
Health Saving Account
Seek professional help

To help business owners, our experienced professionals have explained these tax saving tips in 2022 in detail. Let us Have a quick look at each of them.

1. Record All Your Business Expenses

No matter how large or small your expense is? You must record each and every expense that is incurred towards running your business. At the beginning of your business, there are certain preliminary costs that you pay. All these start-up expenses come under the capital expenditure. Look out for the sections in tax law where you can get some relaxation on these expenditures.

Moreover, recording every business expense helps you in understanding the proper and wise utilization of your funds. Also, the proper records will help you understand your business expenditure in a better way in the long run, ultimately helping you in reducing your business tax liabilities.

2. Take Advantage of Having a Child

Raising a child is really expensive. You can avail the tax credits available to parents to save your hard-earned money. Below, we have explained both the tax credits.

Child Tax Credit

In this, you can avail of up to $ 2000 per dependent child under the age of 17. Based on the modified adjusted gross income (MAGI), you can adjust the gross income with some adjustments for high-income taxpayers. However, if you are a single filer with more than $ 2000 MAGI or a joint filer with more than $ 4000, you can not avail this benefit.

Child and Dependant Care Tax Credit

You can avail yourself of the child and dependent tax credit plan. This plan helps you take care of your spouse, who is dependent on you. Individuals whose gross income is more than $438,000 cannot avail themselves of this plan.

3. Avoid Penalties from Late Payments

Do not try to file your taxes at the last minute. Always try to file your taxes on time, as timely filing sets off present-year losses against future income. Also, the late filing of taxes will end up in filing heavy penalties. Save your hard-earned money by avoiding the tax penalties just by filing the taxes on time.

4. Avoid Capital gains

The capital gain is the one that most business owners look for. However, holding the capital gain for a long period of time will end up in paying the taxes. The tax rate on the gains depends on the time duration you hold up the profit. You can avoid or minimize capital gains by practicing some simple things.

Try to hold the gain for a longer period of time
Try to donate the appreciated stock
Try to reinvest the dividend

Do read the official website of the IRS to know the exact income tax rates.

5. Learn about 401 (K) and W4 Forms

The most popular way to reduce taxes is the 401 (K). Less taxable income means less tax. The paychecks from 401 (K) are exempted from the taxation. For the year 2023, you can funnel up to $ 22,500 per year into an account.

Also, you can take the help of W 4 Forms to save your hard-earned money. The W-4 form is given to your employer, clearly stating how much tax they can withhold from your paychecks. By simply raising the tax withholding, you can pay less when it comes to paying taxes. However, if your refund is big, you can reduce your withholdings.

6. Contribute to Retirement Account

Contributing to the tax-deferred retirement plan, you can simply reduce your tax bill. There are several retirement plans that maximize retirement savings, and you can also reap the benefits of tax savings. As a small business owner, you must invest in a good retirement plan as a business tax savings strategy.

7. Add money to 529 Account.

The 529 offers two potential ways to save your hard-earned money. The contributions made with after-tax dollars are tax-deferred while invested. Also, the amount used for educational purposes is exempted from taxes. Moreover, the ones who are contributing to the 529 accounts are eligible for state income taxes or credits.

8. Contribute to Different Schemes/Charity

The tax saving tips for salaried employees earning a high income are to contribute to the different schemes or donate more to charity. As per the IRS, you can make cash deductions up to 60% of your adjusted gross income. For the non-cash assets, it is 30%. To save your taxes, you can donate directly to a charity. Also, you can donate non-cash assets such as stocks to avoid capital gains.

Moreover, you can invest in companies that pay dividends. To reap the benefits of the tax saving tips for small businesses, you must invest in the companies that are qualified by the IRS and pay you the qualified dividends.

9. Health Saving Account

The employees who are on a high deductible health insurance plan by their employer can avail of health saving accounts to save on taxes. The HSA contributions are exempted from the taxes. The contributions made by the individual directly to the HSA account are 100% tax-exempt.

The maximum deductible contribution for an individual is $ 3,850, and for a family, it is $ 7750 for 2023.

10. Seek Professional Help

The tax laws are often unpredictable and bring a new wave every year. These changes significantly impact your returns and deductions. The changes can be positive or negative, depending on the business environment. As a business owner, it becomes very difficult to keep a constant eye on these changes. Often, the owners miss out on the tiny changes, which results in them paying heavy taxes. To overcome such scenarios, you can seek the help of a professional expert. The certified professional accountant (CPA) will take care of all tax changes that are relevant to your business and help you in saving your tax amount.

Related Page: Cash Flow Projection

Bottom Line

Giving your hard-earned money to the government is the most difficult task. However, with the right strategies, tax saving tips for small businesses can pay less to the IRS. However, while applying these tax-saving strategies, always keep in mind that tax codes are always subject to change. So, always keep yourself updated to avail yourself of the best possible tips and tricks. In case you still feel the need for a helping hand, do call us at +1-866-408-0444.

Bookkeeping

Why Should You Hire A Professional Bookkeeper?

January 20, 2023 admin

Recording and handling the company’s day-to-day financial activities is major in every successful business. Isn’t it difficult to handle all the business accounting tasks alone as a business owner? This is because managing all the accounting tasks on your own requires effort and dedication. So, to reduce all such stress from your shoulders, hiring a professional bookkeeper that fits best for your business is a must.

This comprehensive guide covers everything you must know to get the best bookkeeper to help the company’s growth. Thus, it would help you get a better vision regarding improving the business.

Are you facing difficulty while choosing a professional bookkeeper for your company? Contact us anytime anywhere via call at +1-866-408-0444, and our experts will guide you with the proper tips to get the right one as per your requirement.

What are the Job Responsibilities of a Professional Bookkeeper?

A bookkeeper is a person in the company responsible for handling financial tasks such as preparing accounts. Moreover, they also help businesses consolidate the accounts books, bill reminders, process payments for suppliers, and manage payroll. However, to learn more about the job responsibilities of a bookkeeper, you must go through the pointers below.

The bookkeeper helps in maintaining the general ledger by shifting subsidiary account summaries.
Moreover, it also helps generate financial reports by collecting, analyzing, and summarizing account details and trends.
Also, it prepares the system to account for all the accounting transactions by constructing the charts of accounts and explaining the bookkeeping policies.
The best thing is that the bookkeeper works according to the rules and regulations of legal, federal, state, and local laws.
They also help the companies handle subsidiary accounts by verifying, allocating, and posting the transactions.
Additionally, the bookkeepers also keep the proper track record of the historical records by filling the documents.
Another major role of the bookkeepers is to contribute to the team effort so that they can focus on achieving the results required.

Know About the Reasons Why You Need to Hire a Bookkeeper?

1. Help you in Saving Your Precious Time:-

Usually, business owners have to spend several hours handling bookkeeping and other accounting tasks alone. Since it occupies a lot of time and is complicated, you need to leave it at the bottom of the list. However, when the deadline for filing the tax returns, you have to spend all your valuable time to pay tax on time.

Outsourcing a highly skilled bookkeeper can make time in several other crucial business segments. Even though you are busy performing other business tasks, the bookkeeper will handle all the financial tasks and help improve the workflow.

2. You can Focus on the Growth of Your Business:-

Once you get a clear insight into the income and expenses of your company, it becomes much more convenient to handle the financial situation. Moreover, it also gets easier to determine spending patterns and sales trends.

A well-trained and dedicated bookkeeper will help you make a better decision regarding the day-to-day business activities. Moreover, they can help you predict seasonal ups and downs. Thus, they will ensure that you properly decide to spend money in case of a cash shortage or surplus.

3. Gives You a New View Point About Your Business:-

For instance, if you are running a startup and are in the development phase, the bookkeeper will help you by giving you a new viewpoint of your business. They will put all the accounts in the books of accounts and run reports on how much the company is earning monthly or yearly.

Afterwards, the bookkeeper will give you a clear picture of the numbers and help you decide accordingly. Moreover, they will give the outside point of view and tell you how to run the business efficiently so that you can earn more profits.

4. Ensure the Smooth and Error-Free Tax Filings:-

Every year, when the tax season arrives, it becomes a hustle for all the company owners to file their taxes on time to avoid late tax penalties. So, to avoid such hustle, organizations need to hire a well-trained bookkeeper. They will offer you the interim or yearly financial statement, defining the exact financial status of your company.

As a result, it would help businesses to make better decisions in advance, which would help them reduce their tax bill. Above all, having all the documents in one place will make generating accurate and complete tax returns more convenient.

5. Helps you in Saving Money:-

Sometimes, business owners must pay a huge amount for late tax filing or filing it inappropriately. So, hiring a bookkeeper who can help you save money by filing taxes timely without any errors is mandatory. Also, the bookkeepers will record the financial statements properly, spot duplicate entries, and point out when you are spending more than you are earning.

6. Assist you in Handling Cash Flow Smoothly:-

Being a business owner, getting occupied with other financial tasks in the company is very common. But, sometimes, the business owners need to realize that there are some pending payments from the client end. As a result, the delay in the payments might cause a severe impact on the cash flow, as you need to keep it updated.

Having a bookkeeper for your company will keep you updated by sending reminders to your clients regarding the late payment. As a result, this will help businesses track the cash flow statement properly. Thus, it would give you a clear picture of your company’s financial health.

7. Eliminates the Cost Spend on Financial Obligations:-

Many small businesses think handling all the business financial tasks alone will help save their money. But, the reality is that hiring a professional bookkeeper will help you save money and tell you where to invest to get more profits. With the help of a bookkeeper, you can reduce the human error risk, missed payments, late tax filing, and delayed accounts receivable.

As it is said, time is money, so spending time on the growth and expansion of your business will take it to another level. Hurry up before hiring a bookkeeper who fits your business is too late.

Related Page: Cash Flow Projection

Wrapping It Up!!

We hope this post teaches you why hiring a Professional Bookkeeper for your business is beneficial. Picking the right one from your company will help you make better financial decisions, which would benefit the organization’s growth. However, if you still want to get any additional information, feel free to talk with our experts at +1-866-408-0444.

Accounting

Top 10 Accounting Software For Small Business Of 2025

January 20, 2023 admin

Accounting software is crucial as it helps small businesses handle their finances and account-related tasks. Also, it streamlines the daily accounting tasks so that you can focus on the other important section of the business. Out of many accounting software available, it becomes difficult to pick the best one that fits your requirement. Considering this, we have generated this post in which we have discussed the top 10 accounting software for small business of 2025.

Want to gather more information regarding top 10 accounting software for small businesses or Online Accounting Software? If that’s so you can have a one-to-one consultation with our experts at +1-866-408-0444 and get an immediate response.

Learn More Details About Top 10 Accounting Software For Small Business-

If you cannot choose accounting software, you must use it for your business. Don’t panic!! Here, we have provided you with a list of the top 10 accounting software for small business of 2023 or Accounting & Bookkeeping Software Tools. This will help you make the best decision that suits your needs.

1. Intuit QuickBooks :-

QuickBooks Intuit is the widely-used software that small and medium-sized businesses use to do their accounting tasks easily. Also, it provides various features consisting of mileage tracking, sales tax calculation, and bank reconciliation.

Moreover, it also provides its users with a payroll feature to pay the employees on time. It is the best software that not only handles your accounting tasks but also helps in managing the bookkeeping also. Apart from this, it also allows you to schedule payments to save precious time and update customers on billing progress.

2. Xero :-

It is another accounting software designed for small businesses, accountants, and bookkeepers. Moreover, it provides its users with advanced features to handle their accounting tasks smoothly. Apart from this, it also helps in reducing manual tasks by automatically replicating billing details. Other features of accessing this application are:

You will get real-time tracking of your expenses with this accounting software.
It helps access and monitor the mileage from anywhere and at any time using the mobile application.
Allows the users to generate easy but informative reports for monitoring the growth of the business.

3. FreshBooks :-

FreshBooks allows small businesses to customize the charts of accounts to get a clear vision of the company’s growth. Also, it assures that the users are paid on time via bank integrations and online payments. Moreover, it also provides you with a feature using which you can set up reminders using customizable settings.

Using FreshBooks, you can simply establish different reports that will help the business owners to make the strategy for next time. You can respond promptly to your clients using the mobile application without any further delays.

4. NetSuite :-

The cloud-accounting software automatically consolidates general ledgers and inserts all the data to customize the reports. Using this software you can easily record close cycles via systematized closed checklists. Also, it helps streamline payments by connecting Suite Payments to banks or accounts. Apart from this, it also provides built-in solutions that integrate with the accounting software so that the clients can easily do everything in one place.

5. Sage50 Cloud Accounting :-

Sage 50 Cloud Accounting is the one-stop solution for small and medium-sized businesses to manage finances. It allows users to link their bank accounts to the accounting software so that they can easily do online banking. Doing so will help you download the latest bank transactions, and also, it will help you in keeping track of the business processes.

Moreover, it also allows its users to pay their vendors electronically or by printing checks. Using this software, you can also reconcile the bank statements to get a proper view of the accounting.

6. Zoho Books :-

Zoho Books is another topmost accounting software that automates workflows and helps track expenses. Also, it provides an inventory management feature to keep track of the goods stocked, and you can also evaluate the number of goods that must be restocked. Moreover, it consists of other features, including: automated workflows, recurring transactions, and project management.

It also provides an interactive trial version so potential users can easily access the interface. You can now prepare the invoices within no time, and there’s no need to verify the details. You can also handle your tasks and receive live updates anytime on your device.

7. Wave :-

It is an outstanding software that helps small businesses with top-notch accounting features and functions. Moreover, it allows users to send invoices just with one single click. The best thing is that the invoices and payments get automatically recorded and synced using this accounting software. Thus, this ensures easier and error-free bookkeeping.

Wave software helps prepare the instantly monthly and yearly reports on the mobile application. Also, it allows the users to monitor customer communications via its informative history records.

8. AccountEdge Pro :-

It is the top-rated accounting application that helps businesses manage their accounts. Using the AccountEdge Pro accounting software, you can manage your banking, credit card, and expense account easily. Also, it helps the users in tracking their expenses. Moreover, it helps in tracking the business overview simply yet informally.

9. AccountingSuite :-

AccountingSuite software enables small businesses to create invoices, pay bills and manage accounts. Bank connectivity is also an advanced feature that allows you to connect your bank account. Thus, it helps in managing your bank-related tasks easily and conveniently. Moreover, it includes robust security and upgraded features that enhance your accounting experience.

10. FreeAgent :-

FreeAgent is amongst one the top 10 accounting software for small businesses that reduces the efforts of manually maintaining the accounts. Also, it provides you with instant profit snapshots without preparing the report and looking at how well the business is running. Moreover, it reduces the time by establishing one invoice from various estimates.

Wrapping It Up!!

We hope now you can easily choose the best software among the top 10 accounting software for small business of 2025or Best ERP For Small Business. However, if you require any additional help while choosing the best software as per your needs, consult our professionals at +1-866-408-0444.

Accounting

An Essential Guide On The Difference Between a Bookkeeping And Accounting

January 20, 2023 admin

There’s a common query about what’s the difference between Bookkeeping and Accounting. Are you confused between the two as well? If yes, continue reading this insightful and informative blog to understand the two different terms in detail.

Need professional assistance to understand the QuickBooks mechanism for Bookkeeping and accounting? If yes, connect with us anytime anywhere and reach out to our QuickBooks team.

The thin line between accounting and Bookkeeping is slowly declining. Agree? With the advent of accounting and bookkeeping application programs, like QuickBooks, some accounting elements are being slowly immersed into the bookkeeping process. Simultaneously, the bookkeeping application can now induce financial statements, which were earlier part of the accounting process. However, there are still many differences between the two processes. So, let’s continue learning the two specifically.

QuickBooks Bookkeeping: A Quick Introduction

Basically, Bookkeeping can be defined as a series of daily operations of your business, including business financial tracking, recording, organizing, etc. A well-maintained bookkeeping practice helps business managers record their business financial data based on the date, figure, and business category. Eventually, they can easily track each and every purchase of their inventory along with accurate sales, payments, and receipts.

To understand Bookkeeping better, you need to pay attention to the following points:

Whatever data has been provided by your business bookkeeping, management can’t make decisions based on that data.
The process of Bookkeeping helps business managers keep all their financial transaction records symmetrically and properly.
An accountant generally oversees the workflow and management of bookkeepers. Also, bookkeepers must be accurate in their financial records.
Bookkeeping doesn’t allow the preparation of financial statements. However, Bookkeeping also doesn’t require any skill sets.
Bookkeeping managers don’t need to do any deep analysis for operating their business financial operations.
You can find two sorts of business bookkeeping: single-entry and double-entry.

QuickBooks Accounting: A Brief Description!

Business managers record, classify, analyze, and present their company’s financial transactions, and this process is called Accounting. This accounting process basically converts a business’s regular financial information into a managed database that helps accounting managers understand their company’s incoming and outgoing cash flow.

If your business is running with a well-managed and proper accounting, you can easily track your company’s financial health based on the outputs of your investors, regulatory authorities, and creditors. These outputs are reported periodically, including your balance sheet, cash flow statement, tax reports, and profit and loss statements. The major role of certified accountants is to manage more complex financial operations.

Take a look at the following points to learn accounting with greater insights:

Accountants provide financial data, which is important to make decisions by your company’s management.
Accountants estimate the company’s financial situation and later communicate the financial information to the relevant authorities.
Since accounting is an analytical and complex process, it requires a special set of skills in the particular accountants handling your business.
The accountants use the information gathered by the bookkeepers to analyze and translate that financial information into data and then convert it into reports.
During the accounting process, all your business’s financial reports are prepared.
Whatever loan proposals you want to make or prepare your company’s budget, the accounting process helps managers to do so.
If accountants wish to be entitled to Certified Public Accountants, they must have enough experience and the required education for the same.

Understanding the Concepts of the Difference Between Bookkeeping And Accounting

Bookkeeping	Accounting
The main focus of the accounting is to file tax returns, conduct task planning and provide tax advisory.	Accounting is the process that uses the information collected by the bookkeeper and uses it for preparing the adjusting entries.
Moreover, using this accounting practice you can easily send customer invoices and record payments received.	It is the practice that is initiated to analyze the actual costs of the operations.
The bookkeeper prepares the monthly financial statements to know the actual financial status.	The accountants examine and analyze financial statements for better performance.
The main focus of this practice is to provide you with the year-end financial statements and tax documents to the accountants.	It helps in processing the payroll so that you can handle payroll-related tasks easily.
Accounting provides its users with essential information to the business owners that helps them in financial decision-making.	It helps in assessing the financial status of your company and helps in preparing the financial forecasts.
Additionally, it helps the users to conduct the bank reconciliation every month. Hence, it helps you in detecting any discrepancies between the accounts so that you can maintain the accounts properly.	Accounting provides its users with the essential information to the business owners that helps them in financial decision-making.
You can also prepare the books for the accountants so that they can easily maintain the cash flow.	The accounting helps the users to perform the audit. Doing so will help the accountants in finding the discrepancies between the financial statements to improve the financial status.

Related Page: Outsource Bookkeeping for Small Business

Particular Functions of Accounting & Bookkeeping

So, we hope you have understood the basic concepts of both accounting and Bookkeeping and the difference between the two. In this section, we will discuss the major roles and functions of both processes for better learning. Continue reading!

Notable Functions of Accounting

The accounting process is mainly and broadly transactional, and that’s why it is considered a subjective process. The following are the principal roles of accounting:

Review your business’s financial statements.
Analyze and accomplish your company’s income tax-related operations.
Accounting plays a prominent role in analyzing your business’s cost of operations.
Help business owners understand their financial operations and make decisions.
Run and customize financial reports as per your balance sheet, yearly reports, and profit and loss statements.

Fundamental Roles of Bookkeeping

Bookkeeping is the key process to running any business successfully, with maintained financial records based on daily transactions. We have listed a few main functions of Bookkeeping.

Bookkeeping helps business managers maintain and complete their payroll-related tasks and operations.
Help business managers post debits and credit information.
With daily Bookkeeping, managers can easily track and balance their company’s subsidiaries, historical accounts, and general ledgers. Maintaining general ledgers is also a main function of the bookkeepers.
Produce and update invoices in real time.
As we noted above, one of the prominent roles of Bookkeeping is to record your financial transactions to help business owners handle their finances.

Accounting & Bookkeeping Workflows in QuickBooks Application

The QuickBooks application is known for handling the bookkeeping and accounting operations and helping business managers seamlessly maintain their financial workflow. Now, both the accounting and bookkeeping processes comprise different workflow features in the QuickBooks application. Let’s have a look:

Accounting Workflows in QuickBooks

Creating and emailing invoices to clients and customers.
Receiving and recording payments for invoices in QuickBooks.
Customizing reports and estimating based on profit and loss statements.
Manage items and inventory with deep analysis of the cost of goods sold and in-stock quantity.
Creating bills and assigning expenses.
Maintaining customer databases with real-time information.

Bookkeeping Workflows in QuickBooks

Automatically track and manage your company’s sales transactions.
Maintain a record of your clients, customers, vendors, and inventory information.
Another bookkeeping workflow is to record and categorize the transaction information into financial account data in QuickBooks.
In QuickBooks, the general ledger records all your business activities.

Summarizing Everything..!

We hope you have learned about accounting and bookkeeping processes with this insightful blog post. However, if any query or confusion is bothering you, you can freely approach our QuickBooks professionals at +1-866-408-0444. Our experts will share their expertise to make you understand everything in detail.

Bookkeeping

Top 10 Common Bookkeeping Mistakes

January 20, 2023 admin

Bookkeeping is the pre-eminent task that small business owners face. Compared to large enterprises, small business owners possess fewer resources. This means that one person ends up wearing more than one hat of responsibilities. Common Bookkeeping Mistakes takes hours and hours of your time. The task might be boring, but it is an essential road for a successful business. An unsuccessful business is paved with unrecorded and poorly managed accounting services and common bookkeeping mistakes. Showing zero interest in fulfilling the basic requirements of accounting affects your business’s health badly.

Top 10 Common Bookkeeping Mistakes & How to Avoid Them

The recurring bookkeeping mistakes will put your business in jeopardy. However, by avoiding the most common top 10 mistakes in bookkeeping, you can save your time and money.

So, below are the top common Mistakes in Bookkeeping that small businesses must avoid for a flourishing and nourishing business.

Carelessness when Bookkeeping
Improper Categorization of Income and Expenses
Not Securing Backups
No Reconciliation
Mishandling Sales Taxes
Poor Internal and External Communication
Fail to Properly Identify Employee
Not Chasing Late Payments
Not tracking Reimbursable expenses
Bad Cash Management

Fortunately, these bookkeeping mistakes can be easily fixed as soon as you notice them. Let us delve a little deeper into these avoidable mistakes of bookkeeping.

Carelessness When Bookkeeping

Poor record keeping or the improper handling of records is the most common mistake that most business owners make. It is quite common to forget about insignificant expenses, receipts, and transactions. However, maintaining an accurate monthly record of finances is mandatory. The monthly record of every income and expense helps you in the audit by not only saving your precious time but also saving your hard-earned money from penalties and fines. It is the job of the bookkeeper to maintain an accurate and up-to-date record. Also, organizing them perfectly is the task of a bookkeeper.

Apart from this, the carelessness shown in bookkeeping will result in the below-mentioned costly bookkeeping mistakes:

It will result in the poor business decision that hampers the growth of your business.
You will end up hiring more employees, taking extra loans, and investing in extra equipment.
The transactions are miscategorized, which results in another bookkeeping problem.
It is harder to categorize the over-mid bookkeeping account.

Improper Categorization of Income and Expenses

The second most common mistake that business owners make is to delegate their financial tasks to someone who does not have the proper knowledge of formal bookkeeping. An incompetent person will mix up your personal and business expenses. Also, they might end up mixing your income and expense transactions. However, mixing up the transactions is the worst endeavor that a business faces. Mixing up of the two accounts creates a problem in reconciliation. Also, you need to verify every transaction other than personal transactions at the time of audit. Henceforth, the merger of two accounts is havoc for the business’s financial structure.

Not Securing Backups

Company data are precious. But what if you have not prepared yourself for the worst, like crashing the system or accidentally deleting a file? Henceforth, it is very important to create a backup of your company data. It prevents the loss of precious data from unforeseen issues. You can create the backup copy to an external hard drive or on the cloud.

No Reconciliation

The worst thing that the business owners do is not reconcile their accounts book with the recent bank statement. The bank reconciliation is a mandatory thing that must be performed every month to ensure the wholesome financial health of your business. The proper reconciliation helps in identifying the right source of your income, which helps in avoiding potential audit issues.

Mishandling Sales Taxes

Neglecting the sales tax comes with hefty consequences and will result in heavy fines and penalties. Also, if your bookkeeping entries are misleading, it will result in calculating the wrong sales tax, which will ultimately land you in trouble in the end. Moreover, as per records, small businesses often fail to deduct sales taxes from total sales, which comes as a surprise tax at the time of filing taxes.

Poor Internal and External Communication

For maintaining a healthy bookkeeping record, it is advisable to have strong and clear communication between the bookkeeper and the company’s employees. The bookkeeper must be aware of the company’s internal process. It helps the bookkeepers in tracking the financial statements. Also, open communication helps them manage the payroll, inventory, and budget in a much better manner.

Fail to Properly Identify Employee

Usually, the small businesses have both the employees and the independent contractors. Misclassification of the employees will put you in legal trouble as you end up paying the wrong taxes. Henceforth, it is very important to properly classify the employees and segregate them as per their categories.

Not Chasing Late Payments

Most of the business owners forgot to keep track of late payments. For a nourishing and successful business, it is important that you get paid on time for your services or products. However, sometimes, the customers pay you later. And often, these payments get untracked by the business owners. To overcome this
bookkeeping error, most bookkeeping applications offer a unique feature that reminds you of late or upcoming payments.

Not Tracking Reimbursable Expenses.

Often, small businesses pay from their pocket or from their credit card. However, they often fail to keep track of these expenses. Usually, these expenses are reimbursed. However, they fail to submit the expense for reimbursement. The failure of these reimbursements is not only a loss in money, but you also have to bear the loss of tax deductions. Henceforth, it is advised to keep track of these reimbursable expenses.

Bad Cash Management

Small businesses deal with a limited amount of cash. However, managing the cash involves a lot of factors, such as the amount receivable, loans, and more. Often, businesses fail to keep track of their finance. However, ignoring the cash flow will result in problems.

Also, apart from that, make sure that your customers are aware of your payment terms and conditions.

Say No to Book Keeping Mistakes With Us

Bookkeeping is the unavoidable crucial task that is necessary for maintaining good financial health for your business. By paying a little extra attention, businesses can easily overcome the common mistakes in bookkeeping. If you are ready to avail of bookkeeping services, we will help you. We assure you the fastest, most reliable, and most trustworthy bookkeeping services from experienced professionals at +1-866-408-0444. Our services are highly cost-effective and help in the growth of your business.

Business

Explaining The Top 8 Payroll Management Tips For Small Businesses

January 20, 2023 admin

Payroll management tips for small businesses are the most tedious, daunting, and time-consuming aspect of every business. Even for the experienced team, managing payroll can be the toughest process to handle. Even a slight oversight can result in massive labor and lawsuit violations. Henceforth, it is essential to manage payroll effectively.

Payroll is a monotonous and time-consuming aspect of every business. However, in spite of its difficulties, it is the most important aspect that requires a lot of attention and focus. To lower payroll problems, most companies make use of Payroll management software. But, using the payroll management software is not an easy task. Most individuals screw up while using the Avant grade application.

8 Payroll Management Tips For Small Businesses

The payroll management process encompasses the entire process of calculating employees’ salary/wages, taxes, and withholdings. It withholds the financial documents of your business. The software performs everything from holding your employee’s information to accomplishing complicated payroll tasks. However, it is important to understand the proper way to use the application.

Let us have a look at the Payroll management tips For small businesses.

Select the appropriate software
Set A Budget
Outline the Payroll Process clearly
Know the payroll deadlines
Categorize the Employees properly
Review the Information for Accuracy
Understand and Abide By-Laws
Decide the Pay Schedule and Salary status

Now, let us have a detailed look at each of the payroll tips and tricks.

1. Select the Appropriate Software.

The market is flooded with various payroll management software such as QuickBooks payroll, Gusto, Sage, Just Work, and more. Though most of the applications are cost-effective and easy to use, you must select the appropriate software that best fits your business requirements. Before choosing the payroll management software, you must check the mobility, tools, integration, and user-friendliness. Also, you must select the easy-to-use software; otherwise, you will end up investing in how to learn payroll management software.

2. Set A Budget

Setting up the budget in the payroll management system plays an important role. It is a good idea to make sure that all wages and taxes paid must be included in the budget. As such, there is no fixed percentage that you must follow while budgeting in payroll; henceforth, you must consider your business requirements and necessity. Also, do not forget to set your budget constraints while buying the payroll management application.

3. Outline the Payroll Process clearly.

No matter the size of your business, the proper documentation will serve your business in the long run. It is mandatory to keep the proper records of every employee, their wages, and payroll reports. The well-documented payroll process will have the below-mentioned documents:

Form W 9
Form W 4
State W 4
Tax Compliance
Retirements plan
tax Deposit timings
Tax rates (state and federal)

Apart from that, you must outline your payroll processes and policies clearly. It will avoid the later chaos in life. Also, it ensures that from HR to employee, every single employee is on the same page and is aware of the process.

4. Know the payroll deadlines.

Being aware of the deadlines makes the payroll process much easier. It is recommended that you meet the tax deadlines in order to avoid the penalties. Also, keep the W2 deadlines on priority, as you can not file for an extension, just like income taxes. You must set the alarm to remind you of the deadlines. Working ahead of deadlines will help you file accurate information.

5. Categorize the employees properly

As a business owner, you must categorize your employees properly. You must categorize them as an independent contractor, full-time employees, or hourly pay employees. This helps you in calculating and deducting the accurate payable taxes. For the permanent employees, you must take care of their overtime and the minimum wages payable. However, this is not true for the independent contractors.
Also, the wrong taxes will land you in trouble.

6. Review the Information for Accuracy

There are chances of mistakes when entering the information in the system. These small mistakes can cost you in dollars; hence, it is essential for business owners to take care of these mistakes. Or you can hire a professional who takes care of your payroll system and runs a complete audit of payroll.

Also, make sure that the information entered in the payroll is safe and secure. The payroll information holds critical and sensitive data such as employee name, social security number, salary amounts, bank account, and address of an employee. So, make sure that it is not accessed by every employee or outsider. Proper data security measures must be implemented to ensure that the sensitive data is not stolen or misused.

7. Understand and Abide By-Laws

No matter how small or big your business is, it must abide by state and federal laws. Make sure that the payroll rules and regulations must be fulfilled by your organization. As the payroll laws are a little bit complicated and differ a little bit from state to state, make sure that your business payroll system is in compliance with these laws. In case you feel stuck, then you can take the help of an expert to understand the latest laws.

8. Decide the Pay Schedule and Salary status.

Most small business owners make mistakes in deciding the pay schedule and salary status, which leads them into trouble. Henceforth, make sure that you follow the payroll laws. Let us have a quick look at both of the terms.

Pay schedule

Also known as pay frequency, it simply means that how often you pay your employees. It is advisable you must meet the minimum paycheck laws of your area. Mostly, the pay frequency is weekly, bi-weekly, or monthly. You must pay your employees on time, irrespective of the time period you pick.

Salary Status

It simply means how salaries are computed. You must pay the right salary as per the employee’s position.

Related Page: Tax Saving Tips For Small Businesses

Tackle Payroll with Us

Handling the payroll is the most hectic task for most small business owners. However, with the right tactics, you can easily manage the payroll process. To avoid penalties and fines, you must constantly check the new tax laws and create new payroll policies to ensure compliance. If this is too much for you to handle, do not worry. We will help you in effectively handling the payroll problems to a hassle-free business query. Our experts at +1-866-408-0444 will help you in staying at the top.