Bookkeeping isn't that fun. Seeing how much money your business made and watching profitability grow can be fun. But the actual act of accounting is mildly satisfying, at best, and frustrating to the point of tears, at worst. Even though bookkeeping software has become user-friendly, you still might end up making costly mistakes if you don't have some accounting chops to help you understand how to troubleshoot and fix things.
It's probably time to outsource your bookkeeping if any of the following are true:
You've tried to set up your chart of accounts, only to quit after getting stuck deep inside a Google hole.
You can't figure out why the bank balances don't match, and so you never reconciled your accounts.
Your business is doing so well that you don't have time to sit down and focus on the bookkeeping.
Read MoreDisclaimer: The following is not tax advice. It's a guide to help business owners and the self-employed understand their tax obligations.
Small businesses and their owners have a plethora of ways they can and may be required to pay taxes. From Federal to local taxes, once you start to wrap your head around the American tax system, you'll realize it's kind of a hodgepodge of laws and rules put together over time. Think of it as an ugly collage of regulations, but it's much worse because percentage math is involved. Another frustrating aspect is that the laws may change. We saw this most recently in 2019 with the Tax Cuts and Jobs Act. Although a good accountant will help you navigate through the ever-changing tax code, as a business owner or freelancer, it's your responsibility to get a foundational understanding of the world of business taxes.
This guide is to help business owners and the self-employed understand their tax obligations. Once you can wrap your head around how small business taxes work, you'll be able to use this knowledge to make better decisions and to ask your tax advisor (your accountant) better questions.
Read MoreWritten by Luke Frye
Tax time is coming again โ you can feel it, canโt you? Like a vibration on a train track.
Itโs unstoppable, yes, but that doesnโt mean you have to be flattened. Learning about how to handle your taxes is the best way to avoid a nightmare scenario. The good news is that there are some basic principles, and it doesnโt take a wizard to learn them.
Here are four ways to have a smooth tax season, no locomotives involved.
Read MoreTax season can feel like a slog to creatives and entrepreneurs. who arenโt numerically inclined. But with some patience you can learn how to be savvy about taxes, including what you need to know to make sure youโre not missing any write-offs that can save you money.
Letโs look at a run-down of the details on write-offs, also called deductions, so you can head into tax season with confidence.
Read MoreWritten by Luke Frye
The IRS may seem like an unforgiving institution, always breathing down the necks of small business owners for the next payout. But the taxman is actually quite obliging when it comes to allowing extensions on your tax filings.
What is a tax extension?
Itโs easy to request several more months to finish your tax paperwork. However, donโt get too excited: The extension is only for the filing of your return, not for the actual payment of your taxes.
Read More"You do not rise to the level of your goals. You fall to the level of your systems. Your goal is your desired outcome. Your system is the collection of daily habits that will get you there." - James Clear"First we make our habits, then our habits make us." โ Charles C. NobleI can see why goals get all the glory. They're aspirational and sexy. Goals can give us hope, the feeling of progress, and they can provide the aimless sense of direction. Reach a goal is social media worthy, an opportunity for attention and recognition. In our current vernacular, if you give someone props, you can do it by just saying, "Goals." And sometimes, when you achieve your goals, it can feel good - incredible, even. I don't want to hate on goals too much, but I think they get more attention and focus than warranted.
Read MoreWe all operate based on our own set of internal values and principles. We make financial decisions based on them, and our choices shape our financial life.
If you aren't aware of the financial principles you're living and operating by, you might have internalized someone else's, like your mother's fear or risk. Or your father's illusory confidence in his abilities to understand complex financial instruments. Your uncle's skepticism of everyone "trying to make a buck." Your aunt's overconfidence in the intentions of others.
Since there is so much we cannot control, you have to take responsibility for what you can control. Make sure you're acting on the values you truly value.
Here are my own financial operating principles to help guide me to make the best financial decisions with limited information. But really, they are principles to help me on my path to inner peace.
Read MoreEverything is connected. Your relationship with money impacts both your inner world and your external world. In your outer world, outside of you, your feelings about money can impact how you see the world, how you act in the world, and how you interpret experiences in the world. In your inner world, your relationship with money can impact how you feel. You cannot wholly compartmentalize your financial life; as much as you may have convinced yourself you can. How you feel about your financial life and your relationship with money, impacts how you feel about yourself. How you think about yourself affects the choices you make. And all the choices you make, create who you are, what you're able to do, and who you will allow yourself to be.
Read More(Disclaimer: I am not an accountant, and this is not tax advice. Also, a caveat: this applies to folks living in the U.S.)
When I worked as a financial planner, the busiest time of the year was year-end. While every other industry (besides retail) was winding down and taking a leisurely two weeks off, we were going full-steam ahead, juggling year-end tax planning meetings for our roster of clients. Clients were always grateful that we got ahead of the curve. We didn't just prepare them for their tax bill come April 15, often, the strategies we advised, with the help of their accountants, helped save money on their tax bill. More often than not, the savings were significant and wouldn't have been an option to exercise after December 31.
If you're trying to find ways to save on taxes, don't wait until tax season. By then, it'll be too late. That'd be like trying to come up with a strategy against an opposing basketball team after the game ends. All you can do at that point is to accept victory or defeat.
Read MoreI moved to LA when I was 22, having just landed a job as an assistant at a boutique business consulting firm. Part of my job was driving around Los Angeles to run all sorts of errands. I'd deposit checks for clients at various banks all over town. I'd go to the post office to send tax returns via certified mail. I'd pick up lunch for the office, and go shopping for my boss. Keeping receipts for everything was easy. I didn't have very much responsibility, so whenever I got back in the office from one of my field trips, I had time to organize all the receipts. It was easy to make it a priority, especially when I had an employer who was in charge.
If you fast forward to recent years, I had gotten considerably crappier at keeping my receipts organized. For an embarrassingly long time, I was finding faded receipts at the bottom of my backpack or crumpled up in my back pocket, or the worst scenario of all - some would be lost and never found.
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