Posts Tagged ‘Taxes’

How to Hire an Accountant

Rubber stampTax time is fast approaching, and hopefully you have your financial records in order, but in case you don’t here’s some advice on how to hire an accountant. While there are many aspects of your business that you can handle on your own, accounting is one worth turning over to a professional. Accounting goes far beyond simply sending invoices and tracking expenses; a good accountant can also help you with your taxes, as well as find ways to keep cash flowing.

First: Understand Your Needs

In addition to accountants, there are also bookkeepers and Certified Public Accountants that provide slightly different services from one another. A bookkeeper will set up your accounting software and enter receipts and invoices into the system weekly or monthly. She can also handle payroll data and quarterly taxes, as well as create monthly financial statements like balance sheets and cash flow statements. If your needs are simple and you don’t need help preparing your tax return, a bookkeeper may fit the bill.

An accountant, on the other hand, takes on more of the day-to-day bookkeeping needs of your company. An accountant can do everything that a bookkeeper can, with the addition of being able to prepare business taxes. Accountants are typically trained to interpret and analyze financial data, and you’ll pay more for the privilege.

And finally, a Certified Public Accountant (CPA) is an accountant who has passed a rigorous state exam. They’re the only ones of the bunch that can certify an audit. They also provide tax planning, and are highly qualified experts. Naturally, they’re the most expensive option.

Narrow Down the Selection

Ideally, the accountant or bookkeeper you end up working with will have experience with both small businesses and your industry. If you are unfamiliar with accounting terms like depreciation, chart of accounts, and cost of goods sold, you’ll want an accountant who will be patient at explaining it all to you. Remember: even if you hand your finances over to a professional, you still need to understand them. A good accounting partner will be communicative about her process, and will be willing to teach you.

You can hire an individual that works for several companies as a consultant, a smaller accounting firm, or a larger practice. I tend to go with one of the first two options, since they’re more affordable and service tends to be more one-on-one with smaller practices and solo practitioners.

Getting a referral from a colleague or contact can help you find someone faster. Check with others in your industry to find out who they use. Take into consideration your needs, your budget, and their offerings, then whittle your list down to your top three choices.

What to Ask

Interview each provider or firm, just like you would if you were hiring a full-time employee. Some of the questions you should ask include:

  • What accounting software do you use?
  • Do you provide software setup?
  • Do you provide monthly bookkeeping?
  • What is your hourly rate?
  • Can you provide three small business references?
  • Do you work onsite at the client location?
  • What industries do you specialize in?
  • Do you also prepare business taxes?

You want to find an accountant who you can trust with your finances, and who will be with you for years to come. Don’t overlook how important the selection process is, and spend enough time on it to find the best fit for your company.

Changes Coming to Nextiva Invoices

As a service provider in the regulated VoIP industry, Nextiva is required to collect federal, state and local government taxes, surcharges and fees. These taxes and fees are location and usage based and will now be itemized on Nextiva invoices.

Monthly invoices, beginning this month, will include the following sections:

  • Subscription Plan Fee – Product price per user and usage charges, where applicable
  • Package Add Ons – Phones, devices and plan upgrades
  • Shipping – Initial order shipping of phones and devices
  • Taxes and Fees – Itemization of federal, state, city and other local taxes, regulatory surcharges and service delivery fees
  • Phone Numbers on Account – A list of all phone and fax numbers on the account
  • Billing Information – Account billing address and payment information

Standard Definitions:

RRF = Regulatory Recovery Fee: The RRF is assessed as a percentage of interstate and international charges. The RRF is intended to recover increased VoIP provider operating cost due to local, state, and federal regulatory compliance. RRF is separate from government taxes and fees. 

E911 = Enhanced 911 is a service that associates a caller’s physical address with their phone number. In case of emergency calls, the caller’s phone line generates an automatic number identification (ANI) signal to the network. The E911 system then routes the number to the appropriate emergency center. This service is supported by a dedicated network that has been built to address E911 call needs from a reliability, capacity and technology standpoint. All VoIP providers, as well as local and state emergency facilities, are responsible for collecting and funding different aspects of the infrastructure that supports this critical service.

USF = Universal Service Fund: Universal service is the principle that all Americans should have access to communications services. The USF assessment is a charge collected by telecommunications carriers for federal and state funds that support the provision of affordable communications services to rural, isolated, and high-cost regions of the country; low-income residential consumers; schools, libraries, and rural health care.

Invoice Modifications

4 Mistakes that Will Get the Government Calling You

?????????????????????????????????????????????????????I can still remember the day the Department of Revenue shut my company down.  It seems that we had not done a timely job of remitting the sales tax that we had collected from our customers and this government agency wanted their money. My bookkeeper had apparently ignored all their warnings by mail. When they arrived, they put a big sticker on our door, telling all our customers and employees that we had to "pay up to open up". It was a similar story when the IRS was concerned that we were not remitting employees' collected payroll taxes in a timely period of time. This situations happened because as a new owner, I did not know all my tax responsibilities.

Here are four mistakes that can get the government calling on you and maybe even putting you out of business:

  1. Non payment of payroll taxes. Each pay period, a company deducts from the employees paycheck taxes that are due to the government. If a company is doing this themselves, this money needs to go into a separate account and get sent to the appropriate agency.  A better way to do this is to use a payroll service that will withdraw the taxes and pay the government automatically. With this service, there is no temptation by  a "cash strapped" small business owner to spend payroll tax money they collected, but belongs to the government.
  2. Non payment of sales tax. With each transaction, a company collects sales tax for  the government. It is then the companies responsibility to remit these funds to the appropriate agency. A company should ensure that theses taxes get posted to a separate account so the money is there to send at the end of the month.
  3. Non payment of use tax. This is a tax that a company assesses on themselves for product they purchased for their own use where they should have been charged state sales tax, but weren't. This needs to be send to the state typically every quarter.
  4. Health code violations. Run an office that is unhealthy for employees or a location unfit for customers? Inspectors will shut that company down on the spot and lock the doors. This gets much stricter when serving food and beverage or a hotel

In the days when a company's online reputation is critical, getting shut down like this will do nothing but hurt your Yelp and TripAdvisor ratings.

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