We know that no one is excited about taxes (even accountants) but if you are going to build a strong successful business you have to have some understanding of taxes and what they mean in your business. The person who has all answers is your CPA. You should like and feel comfortable talking to them and they should respond to your emails. A great way to find a CPA is to ask someone in your same field of work, a business bestie, if you will. CPAs vary in price, but a good CPA should SAVE you money in taxes and headaches in the long run. Once you find someone you like here is what you should bring to your first meeting and what to ask them.
- Bring your business financial statements. Specifically, your Profit and Loss and Balance sheet. Quickbooks will be able to create these reports for you BUT your books must be balanced. If you need help with bookkeeping that is the first question you can ask your CPA! Ask them if they do bookkeeping or know someone who can show you how to keep your own books.
- Let them know what business entity you are (like a sole prop, LLC or S-corp) and ask them if you need to switch? Is there an entry that would be better for your business?
- Ask them if the need to see any other income (like other W2s or your partner’s income)
- Ask them if you should open an IRA, if so, what type?
- Ask them if you should be paying estimated taxes?
- Ask them if you should be paying sales tax?
- Ask them if there is anything you should be doing to lower your taxable income?
- Ask them if you should be running payroll?
Once you get through these questions it should be smooth sailing. Make sure to reach out to your CPA every year around September to check in and see what your bottom line means for taxes. Also, January is a great time to make sure they are set to do your taxes in the new year.