Questions to Ask Your Accountant
Most clients handle all of the essential tasks when it comes to their business. However, when it comes to the management of finances for the organization, hiring an accountant is highly recommended. Accountants are trained in tracking, and analyzing financial records, while always maintaining security as a top priority. As a business owner, here are 10 questions that you should always ask your accountant when seeking their expertise. At Prasad & Company LLP we are always available to answer any of the following questions.
- What kind of records should I keep?
All business records need to be tracked in order to complete essential tasks such as the filing of taxes, and measuring profitability. Examples of business records include revenue, operating expenses, and employee wages.
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- How should I structure my business?
There are 4 types of business structures that owners need to review before choosing:
Sole Proprietorships: This structure only has one water, and therefore the owner as well as the business are the same legal entity. The owner is solely responsible for all of the business debts.
Partnerships: This structure includes two or more people. The partners of the business share the same accountability for the debt of the business.
Corporations: The corporate is a separate entity from the owner. An owner's personal assets are separate from the business, and if the business has any debts, the owner assets are not at risk.
LLCs: The structure is a combination of a corporation and partnership. Owner's assets are not risk if the business is unable to pay off its' debts, but the owners share the responsibility for taxes.
- How do I prepare for tax season?
Accountants are responsibility for filing your tasks, but as an business owner it is essential for you to organize your business record to make it easier for your accountant. Organizing your business records will ensure that your accountant takes less time to prepare your taxes.
- What expenses can I deduct?
On your tax returns, you are able to deduct your business expenses. However, it is important to note that each deduction has rules that you must follow, so ensure that you are aware of the requirements.
- When do I pay estimated taxes?
Accountants are required to know the tax schedule for the year. Don't be afraid to ask them in order help you understand the requirements on when you should be paying the estimated taxes for your business. Another advantage of using accountants is that they are trained to assist you, by taking on the task of filing or remititing the estimated taxes.
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- How do I know if the people who work for me are employees or independent contractors?
An employee is an individual who you are responsible for paying and remitting payroll taxes. However, for an independent contractor you are not responsible for withholding or paying payroll taxes.
- What is the break-even point form business?
Your break-even point is when your total income equals your total expenses. An accountant is trained to identify your business's break-even point in order to help you achieve your financial goals.
- How do I grow my business?
Accountants are experts in identifying financial opportunities that increase the growth of your business. They are trained in measuring the progress of your business, and can assist you in increasing your cash flow.
- What are my financing options?
Understandably, additional money in sometimes needed for you business. An accountant will be able to assist you in choosing the best financial option for your business, and if you should loan from an investor or a bank.
- How do I manage the inventory for my business?
Making decisions about your inventory is crucial in order to properly sell your products your services. The management of inventory can also affect your taxes, which is why its important to manage as well as understand the value of your industry.
If you are seeking more in-depth answers for any of these questions, contact us for a consultation or feel free to visit our website.