29. November 2007 by Tim Collier.

Even with Santa’s arrival fast approaching, make sure that you do not wait until after his arrival to do your tax planning.  Make sure your books are up to date and hand them off to your accountant.  Hopefully they will be able to come up with some tax savings strategies before the end of the year.  If you wish to do the planning yourself look go to the IRS website for some pointers and the 2007 forms.  If you do want an accountant, but don’t currently have one, then go to the website of you states CPA chapter, or the National CPA association to find accountants registered with them.  A little tax planning now can help you get a less stressful start to the new year, probably one of your resolutions any ways.

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11. November 2007 by Tim Collier.

While bookeeping isn’t the reason you got into business, it is the only way you can keep track of how you are doing. Think of it as your scorecard (also the if the IRS ever comes calling think of it as your saving grace). There are several accounting packages that you can use such as Quickbooks or Microsoft Accounting that are relatively easy to use.  The Microsoft accounting program, express edition is actually free and integrates with MS Office (follow the link above).  This helps you with your invoices as they are tied into your accounting system and gives them a real professional look.  One other benefit of using an accounting program is that it should save you money with your tax accountant come income tax time.

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8. November 2007 by Tim Collier.

The type of business entity that you want your company to be is extremely important. Findlaw is a great site to help walk you through the decision process. Hitting just the highlights, sole proprietorship leaves you exposed liability wise, an llc helps shield your personal assets, but remember to make sure you keep the books seperate from your own. C Corporations are beneficial if you are going public, but otherwise are a little more difficult to manage because of the potential for double taxation and bookeeping requirements. After you do your own research and come up with a general idea of what entity type you want to be, make sure you consult with an attorney.

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16. September 2007 by Tim Collier.

Husband and wife LLC’s have always been a great idea from a liability stand point, but they  have added another layer of tax complication because they require the completion of a partnership (Form 1065)return in addition to the couples individual tax return.  The SMALL BUSINESS AND WORK OPPORTUNITY TAX ACT OF 2007 has changed that.

The new law allows LLC’s that are owned by husband and wives not to be treated as partnerships for federal tax purposes.  They must meet three criteria:

1)    The only members of the LLC are husband and wife.

2)    Both spouses materially participate in the business and

3)    Both spouses elect to have provision apply.

This change is effective for all tax years after 12/31/06. Under the provision a joint venture conducted by a husband and wife is not treated as a partnership and should be reported on the appropriate form on their 1040 (Sch C).  Each spouse must still report the income on their own schedule C and have their own schedule SE. The income will still have to be split by ownership percentage, however this should still reduce the preparation fees, by staying away from the form 1065 partnership return.  This is a great benefit for husband and wife owned LLC’s and should help lower the overall bookkeeping charges to the business.

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