Quickbooks is a fantastic resource and I’m happy to recommend it to my accounting and tax clients. I remember when it could cost tens of thousands of dollars for a decent accounting software package. Plus, you’d then have to hire an expert to come set it up. Figure a few thousand for that as well. [...]
One of our tasks at the first of the year is to destroy one year’s worth of records. Otherwise, as much as we try to keep our businesses virtual, we’re going to get buried in paperwork.If you’re facing that too, you might be wondering how long to keep records. First off, we divide our types [...]
If you have independent contractors (instead of employees) in your business, the IRS is going to be watching closely. This is one of the red flag areas for audit this year and even more as the laws change to require medical insurance for employees. That doesn’t mean that everyone who works for you [...]
Depreciation is a phantom expense. In other words, it’s a deduction that you get to take on your tax return and it doesn’t cost you a dime. That’s the best of all worlds. Your depreciation calculation is only as good as your accounting. First, you start with the basis, which is comprised of the purchase [...]
When you buy a property, there are a couple of things you always need to know for your tax return: how much the basis is and when you bought the property. The same is true when you sell. You need to know what the sales price was and when you sold it. It gets a [...]
A speaker at an AICPA (American Institute of CPAs) stated, at the height of the last real estate boom, that he thought 80% of accountants didn’t understand basic real estate accounting and tax. That statistic has always stuck with me because I think explains why so many real estate professionals got into trouble with IRS [...]
If you sell your principal residence for a gain, you likely have a capital gains exemption. That means you won’t have to pay tax on the gain, provided it’s not more than $250,000 if you’re married or more than $200,000 if you’re single. But that doesn’t mean that the IRS is just going to take [...]
There are three types of financial statements. These are: Balance Sheet Income Statement Cash Flow Statement In some cases when you are reviewing an investment you might be presented with an income statement only. The income statement is only one part of the financial statements. You MUST see all of the financial statements in order [...]
You’ve worked hard for the money from your small business. Make sure you keep it. One of the things that CPAs talk about is the need for separation of duties in your bookkeeping department. In other words, the person writing checks should not be the person who reconciles the accounts or preparing the financial statements. [...]
The most likely person to embezzle from a small business is the bookkeeper. There are two big reasons: (1) Small business owners often aren’t as diligent at checking references and (2) Opportunity. It’s easy to become better at checking references, but the only fail-safe way to stop embezzlement with an in-house is to hire more [...]
