4 New Year’s Resolutions for Your Business
Get ready, America. For the next week or so, the words “New Year’s resolutions” will be thrown around like confetti at a parade. “I’m going to the gym.” “I’m cutting down on carbs.” “I’m finally learning how to cook.”
Big or small, New Year’s resolutions are good for both keeping us honest and making sure we improve as we progress through life. But don’t limit your resolutions to personal goals – you also should resolve to strengthen your small business now that we’ve turned the corner into 2017.
You have so many avenues to choose from: Becoming a better boss, developing your employees, working on sales goals … but don’t forget the accounting side! By improving your small business in the eyes of the taxman, you can save money and stave off that dirty “A” word: audit.
But, just like with any New Year’s resolution, you have to stick with it
4 Great New Year’s Resolutions for Your Small Business
1. Get Your (Business’) Life in Order:“Be more organized” is one of the most well-trodden New Year’s resolutions out there, though usually we think about it in terms of personal organization – buying planners, sticking to a schedule and the like. But think about it in terms of accounting, too. For instance, don’t just keep all of your expense receipts – categorize them, too, putting them in buckets such as “fees” or “business travel.” Set up an electronic accounting system, and actually use it throughout the year. Scan receipts, rather than just saving the hard copy, to ensure that if you need them for audits down the road, the ink hasn’t faded, making them useless. The more documentation you have – and the more detailed and pristine it is – the better.
2. Get in Formation: Is your business currently structured as a partnership? Would it make more sense to re-organize as a C corporation or an S corporation? The nice thing about business structures is that while the rules are fairly strict within any given structure, you do have the flexibility to shift between structures if you decide one fits your company better than another. Just know the pros and cons of each type of structure. For instance, C corps have no limit on how many shareholders you can have, and management and employees alike enjoy limited liability. Of course, revenues and dividends are taxed (hence the term “double taxation”). Also note that while some conversions are tax-free, some – such as switching from a corporation to an LLC – aren’t.
3. Get a Grip on Next Year’s Deductions: We’ve already published a couple of articles about last-minute deductions and other end-of-the year tax to-dos. That’s because many people simply wait until the 11th hour to get serious about their taxes. But one of the best pieces of advice is to not wait and panic-research deductions at the last moment. For instance, did you know that the Section 179 $500,000 equipment purchases deduction won’t expire in 2016, but has in fact been made permanent? And the Work Opportunity Tax Credit – which incentivizes hiring military veterans, among other certain types of long-term unemployed Americans – has been extended through 2019. If you approach your entire year with a laundry list of deduction opportunities already on the brain, you won’t be scrambling when tax time rolls around once more.
4. Get a Hand From Professionals: Not sure how to go about accomplishing any of the tips above? We have you covered, and then some! The professionals at McManamon & Co. are your year-round accounting resource. Yes, that means we’ll be there in January and February when it’s time to think about filing – but we can also help you throughout the rest of the year, whether it’s just to answer questions, or even if you want us to help train your accounting staff in software or best practices.
In 2017, make your New Year’s resolution to better your business stick. Call the tax experts at McManamon & Co. at 440.892.8900 or contact us online today!
Tags: McManamon & Co., small business, taxes | Posted in accounting, McManamon & Co., small business, taxes