If you have been weighing the pros and cons of using a bookkeeping service, you may have some misinformation regarding what outsourcing your bookkeeping means.

To help clear things up, our accountant at AA Tax & Accounting Services wanted to address the five most common myths around outsourced bookkeeping services and show you how your business can really benefit from utilizing this service.

1. Myth: Outsourced Bookkeeping Goes Overseas

One of the common beliefs is that if a service is outsourced from a company, that work goes overseas. While that may make sense for things like manufacturing work, it does not when it comes to bookkeeping work for American businesses. And while you likely could find a firm or freelance bookkeeper overseas to send your bookkeeping, it wouldn’t make much sense.

Reality: You can easily outsource your bookkeeping to an accounting firm in your local region.

That’s right, the reality of the matter is that you can outsource your company’s bookkeeping needs to an accountant who works within your same region, potentially within the same city you are located, depending on your area.

Our accountant works with a variety of clients ranging from local to national businesses, so you can easily opt to work with him or another American accountant who understands the appropriate tax laws and financials.

2. Myth: Sending Bookkeeping Out-of-House Is Expensive

Many entrepreneurs are wary of taking on too many financial burdens, especially if their business is relatively young or goes through regular highs and lows. So, many of them attempt to take care of their own bookkeeping for far longer than they should.

Problem is, bookkeeping for a business can take up a good deal of time, and it also requires a good deal of attention. In the long run, mistakes made while attempting to handle your bookkeeping and other business matters can be far more expensive than simply outsourcing bookkeeping to the professionals.

Reality: You can tailor your bookkeeping service to fit both your needs and budget.

When you work with our accountant, you can structure our bookkeeping service to fit both your needs and budget. Since businesses all have different bookkeeping needs depending on the company niche, size of the business, etc., it is not uncommon for owners to set up customized bookkeeping services with our accountant.

3. Myth: You Have No Control Over Outsourced Bookkeeping

Sending bookkeeping out-of-house may make some business owners feel like they don’t have enough control of the situation. But, business owners who try to extend themselves too far and try to take care of all the aspects of how their companies run often become burned out.

Even with bringing a bookkeeper in-house, business owners have to give up a certain amount of control, as they have to trust the in-house bookkeeper. These individuals may require training and may have fudged their credentials, making them a far less reliable option.

Reality: Business owners have just as much (or more) control over out-of-house bookkeeping as in-house work.

By opting to send your bookkeeping out-of-house, you can set the terms for what you need to be done as well as dictating the schedule. When you work with a professional like our accountant, you can depend on him to deliver the results you are looking for and a high amount of reliability.

4. Myth: Your Bookkeeping Is More Vulnerable Out-of-House

Another common myth about outsourced bookkeeping is that your business’ financial information is more vulnerable when you send it out-of-house. As the news is constantly reporting on hackers invading supposedly secure businesses, it can feel nerve-wracking to think about sending your bookkeeping to an accountant.

Reality: Accounting firms often have the highest levels of information security.

As accounting firms like ours deal with many people’s sensitive financial information, we make it a special point to invest in the best security possible. Both our physical records are protected as well as any digital information, so you can feel secure as you send your bookkeeping to our accountant.

5. Myth: It’s Easier To Do Your Own Bookkeeping

For those beginning their self-employment journey, it may make sense to do your own bookkeeping, as it is usually fairly simple. However, as you start to add inventory, staff, vendors, and more to your business, the ease of taking care of your own bookkeeping goes away.

Reality: Bookkeeping can eat up tons of time for non-professionals.

Instead of trying to juggle the various aspects of bookkeeping on top of your own business concerns, you can unload the work to our accountant. By choosing to have your bookkeeping go out-of-house, you can free up far more of your time to do things that you both enjoy and will help you grow your business.

Have AA Tax & Accounting Services Take Care Of Your Bookkeeping

Here at AA Tax & Accounting Services, we work with a range of business for their accounting needs, from the self-employed with no staff to thriving businesses with multiple locations. If you are ready to take the burden of your bookkeeping off your shoulders, our accountant is here and ready to help.

To create a custom bookkeeping service for your company needs, contact us to meet with our accountant today.

When it comes to startup company planning, there are so many factors to consider, from the service or product you are hoping to provide to your target demographic.

Naturally, the financial aspect is a major consideration, but where many startups go wrong is not having an accountant involved from the beginning. If you aren’t sure how working with AA Tax & Accounting Services can benefit your startup, here are some things to consider.

Know Whether Your Startup Company Is Viable

Planning and launching a startup is an exciting process, but you don’t have to wait for a crash and burn or wild success to find out if your startup company plan is viable.

Instead of waiting, you can bring your business plan into our accountant. By working with our accountant, you can determine how long your business can remain viable with your current amount of money, see what kind of revenue you need to maintain and grow, and other critical concerns.

Start With Solid Financial Business Practices

Having properly organized finances is vital, especially when it comes to doing your startup company’s taxes. Often, tax time can lead to a huge amount of stress for startup businesses, as many of them neglected to set up proper bookkeeping and records, leaving them scrambling through piles of receipts and digging through archived emails for invoices.

You don’t have to go through this when it comes to building up your startup. By working with our accounting services from the beginning, your business can have solid financial business practices in place to keep disorganization from eroding your new company.

Also, as your startup grows, there won’t suddenly be a scramble for better accounting practices since they will already be in place.

Less Wasted Time Re-Inventing

If you wouldn’t bother re-inventing the wheel, then why would you waste time re-inventing accounting practices that already work well? Some startup business owners try and test out various accounting software, bookkeeping schedules, record-keeping methods, all in an effort to find the best accounting practices for their business.

Yet, by working with our accountant, your startup can take advantage of excellent accounting business practices from day zero. With an organized and established accounting practice like ours to help, you can avoid having important financial matters slip through the cracks.

Receive Help With Needed Information To Attract Investors

Funding can be the lifeblood for a startup in its early years, yet it can be tough to acquire small business loans and investors. Part of the difficulty is the fact that most startups have big ideas with very little clear data to back up their grandiose claims.

To support you during your search for investors, our accountant can develop reports to show your company’s earning, potential projections, and other financial statements to add that essential data for your potential investors.

Remove The Hassle Of An Accounting Department

When it comes to startups, the “accounting department” usually consists of you as the founder, or if you’re lucky, your business partner. However, this strategy is not the best use of your resources.

If you and your business partner are not already accountants, then it will likely take you far longer to manage things such as bank reconciliations, general ledger management, day-to-day bookkeeping, balance sheets, accounts payable and accounts receivable, and so much more. These tasks can eat into your valuable time, which you could be spending building up your business.

Even as your business grows to the point where hiring a bookkeeper is a viable option, outsourcing your bookkeeping needs makes more sense. For one thing, you don’t need to provide benefits if you outsource your bookkeeping. Also, if you continue to work with the same accountant who initially helped you launch your business, the consistency can help protect your accounting management in the long run.

Enjoy Expert Advice With AA Tax & Accounting Services

Here at AA Tax & Accounting Services, our accountant has worked with many adventurous entrepreneurs to help them successfully launch and operate their startup.

If you are ready to give your startup the best financial protection, contact us to meet with our accountant.

Many people tend to use the terms bookkeeping services and accounting services. It is understandable, especially since accountants like our accountant at AA Tax & Accounting Services offers both bookkeeping and accounting services. However, these services provide small business owners with different benefits.

Bookkeeping Services Keeps Track Of Financial Information

The main benefit of bookkeeping services is the knowledge that your business’ day-to-day financial business is being tracked and recorded. In general, bookkeepers perform data entry work, from entering invoices to balancing the general ledger.

This work is essential to your business, as it means you will have the information you need to accurately:

• File your taxes
• Track accounts payable and accounts receivable
• Detect embezzlement
• Review the general ledger
• Ensure bank reconciliations occur correctly

Along with this necessary work, some bookkeepers also take care of employee payroll processing, as well as creating invoices for your business to ensure vendors pay you in a timely manner.

Accounting Services Helps With The Financial Big Picture

While accounting services can include bookkeeping duties, an accountant will generally help a business take a longer view in regards to their finances. This means that an accountant will take the information recorded by the bookkeeper and use that info to make reports and recommendations.

For instance, say your accountant takes the information around your business’ profits and analyze it against certain expenditures. That way, the accountant can assess what is a profitable expenditure and what areas your business can tighten up costs. Some of the other essential services accountants can provide are:

• Tax preparation for individuals, businesses, and nonprofits
• Startup company planning
• Business consulting
• Entity Restructuring
• Revenue recognition strategies
• Payroll services

Another important distinction to make when it comes to accountants and bookkeepers is the education involved. While some businesses prefer bookkeeper with some secondary education, all a person needs to be a bookkeeper is a high school diploma.

But with accountants, they need to have at least a bachelor’s degree in most states. And if you are looking for an accounting firm to work with, you can easily check their credentials to ensure they are both educated and experienced.

How To Determine Which Service Your Business Needs

In many cases, the size of your business can help you determine which type of accounting service you need. If you only have a couple of employees, a bookkeeper may be all you need to ensure that your company’s finances are in order. With the accurately tracked information, you can bring your records to our accountant to take care of your tax preparation and filing of your return.

As your business grows, bringing an accountant onboard can help ensure that your company is headed in the right direction. Since an accountant’s job is to take the long view when it comes to your business, they can help point out areas where overspending may be taking place as well as sectors where it makes sense to invest further. These recommendations may involve you looking for new vendor bids and investing in online marketing to grow your company’s reach.

Also, there are plenty of times where it makes sense to work with both a bookkeeper and an accountant. As our accountant performs both of these services, you can feel assured that your day-to-day financial business is taken care of and receive reports and recommendations which will help you continue building up your company.

When you have determined what services you need, contact us to start working with our accountant, and see how we can help you make your business grow.

Tax season is in full swing, and our accountant in Cedar City has been seeing plenty of clients who have inquired about tax extensions.

While an extension can be a helpful tool if you are waiting on paperwork or are a small business owner looking to make contributions to their retirement fund, there are several instances where you should avoid filing a tax extension.

Extensions Only Apply To Filling, Not Your Tax Payment

One of the main reasons people initially consider filing a tax extension is because they are unsure or unable to pay the taxes they owe. However, this is not what an extension is not designed for this purpose. An extension of your taxes only allows you to have more time to file your tax return. You will still need to pay any taxes you owe.

This requirement can sound counter-intuitive, as you may not know exactly how much you owe in taxes until you complete your return. But by working with our tax accountant, you should have estimated tax payments that you can use to pay your taxes by the original filing deadline. If it turns out that you have overpaid after you file your extended taxes, you can receive a refund from the IRS.

IRAs Are Not Able To Be Recharacterized

Prior to the passing of the Tax Cuts and Jobs Act (TCJA), you could file an extension and recharacterize your IRA, converting a traditional IRA into a Roth IRA or vice versa, all while you finish filing your tax return. But since the TCJA has passed, your IRA cannot be changed during a tax extension. So, if you were planning on recharacterizing it, be sure it is done by April 15, 2019.

Tax Extensions Do Not Apply For Married Filing Status Amendments

For those married couples who originally filed jointly wish to change their filing status, they only have until April 15, 2019, to file an amended tax return that reflects their decision to file married, filing separately. Our accountant can assist you in amended your tax return to reflect your new filing status, but you will need to come in before the original filing date, as extensions will not apply.

If you would like expert assistance with your taxes, contact us. Our accountant has an office in Cedar City and St. George and is ready to help you with your tax preparation needs as well as your other accounting needs.

Often, the doings of the federal government seem a world away. When it comes to tax law, however, they always manage to arrive squarely at your doorstep. For local business owners, this is the case with the Tax Cuts and Job Act passed by Congress in 2017.

The good news is many of these changes are beneficial. Some 83 percent of small business owners reported feeling optimistic about the tax changes, according to a recent poll. The bad news is there are significant modifications to how you’ll be filing. Change can be difficult, particularly when it pertains to a situation you already find daunting.

A good tax accountant can help you navigate any tax modifications painlessly, and work to get you the tax breaks designed expressly for someone in your shoes. Meanwhile, let’s look at some ways the new tax policy will affect your local business.

Pass-Through Businesses Get A Deduction

If you’re a “pass-through business” and have made less than $157,500 per year—$315, 000 for those who are married, filing jointly—you’re likely to get a welcome tax deduction.

If you’re wondering what pass-through means, it doesn’t signify that you own a fast-food restaurant with a drive-thru. It means you’re operating as a partnership, S corporation, Limited Liability Corporation or sole proprietorship.

As a pass-through business owner, you may be able to deduct as much as 20 percent of your qualified business income. If your company exceeds the income threshold for pass-through businesses, you may still get a portion of the deduction.

State and Local Tax (SALT) Deduction

Local business owners operating in states with high income and property taxes were formerly able to deduct 100 percent of certain local tax payments. Taxpayers who itemized their deductions were each able to write off their property taxes. They could also choose between deductions in one of two categories:

• Income tax
• Sales Tax

The SALT deduction is still available. Now, however, a ceiling of $10,000 has been put on the number of SALT deductions you can take.

Employers Get Incentives For Treating Employees Well

There are some new incentives, available beginning the 2018 tax year, for employers who treat their employees well. Small businesses who provide workers with family and medical leave in the course of tax years 2018 and 2019 may qualify for a new business credit.

The Exclusion Amount For Estate And Gift Taxes Is Larger

Forward-thinking business owners should be pleased to hear that starting with the 2018 tax year, you ’re now able to pass on both your business and financial legacy tax-free. Individuals once had to make less than $5.49 million o be exempted from the estate tax. That number has been doubled, with the exclusion threshold resting at $11 million for individuals. Married couples don’t have to pay estate taxes unless they’ve received at least $22.36 million.

If you have giving on your mind, you can also celebrate the fact that the annual gift exclusion has been raised from $14,000 to $15,000.

Some Deductions Have Disappeared Or Become Harder To Take

Some key business deductions your company may have relied in the past have disappeared or are now harder to take.

Entertainment expenses

Entertainment expenses, like those courtside seats you were once able to toss at valued clients, used to be 50 percent deductible. Entertainment expenses are no longer deductible. In good news, entertainment events aimed at employees, like your annual Christmas party, are still 100 percent deductible.

Meals for clients

If you take clients out for a meal, you can still deduct 50 percent of the bill, as always. There’s now a caveat, though. If entertainment is included—say you attend a performance at a local dinner theater—you must purchase the meal separately from the entertainment to deduct its cost.

Business Loan Interest

Formerly, you could deduct any interest paid on a business loan. Now, businesses can only write off interest costs equal to 30 percent of their adjustable taxable income. You may be able to claim more if your small business made $25 million or less last year and two years previous, but that’s a discussion you may want to have with a tax accountant.

Operating Loss Deduction

As they say, every cloud has a silver lining. And every bad business year used to carry with it some real tax benefits. Prior to the tax changes, if you were in the red for the year you could choose one of two options:

• Reduce any taxes paid in the past two years
• Reduce future taxable income for the next 20 years.

Under the new tax law, your Operating Loss Deduction can only be applied to current and future years. Further, you can only deduct 80 percent of losses in any given year.

At AA Tax and Accounting Services, it’s our business to stay up-to-date on all the latest tax changes. We’re ready to help you file your taxes for your local business, taking full advantage of tax breaks designed especially for someone in your shoes. Contact us today to make your appointment.

As the season of giving comes into full swing, the taxable year is also drawing to a close, making it necessary to be sure all your finances are in order so you can file your taxes next year.

To help you make the best holiday tax-deductible donations, our accountant at AA Tax & Accounting Services, LLC has tips on how to make your charitable giving count.

Charitable Contributions And Tax Deductions

Anyone can call themselves a charity but not every organization qualifies for tax-exemption, which means you can’t deduct your donation from your taxes. To qualify, the charity needs to be an IRS-registered 501(c)3 organization. Generally, a registered charity will state their status to make the donation process easier, or you can work with our accountant to determine what organization is right for your donation.

The tax-deductible donation you make does not necessarily have to be made in cash. Some other types of donations which are tax-deductible are:

• Stocks donations
• Appreciated assets such as antiques and artwork
• IRA transferred donation
• Real estate donations

If you have any concerns about the tax-status of a charity, you can look them up on the IRS, using their Tax Exempt Organization Search tool.

What Changes In The 2018 Tax Laws Means For Your Charitable Deductions

With the 2018 changes to the tax laws, the standard deduction has almost doubled for all types of earners. This change can make itemized deductions—like charitable donations—less useful on your taxes. However, as you can generally deduct up to 60% of your adjusted gross income when you donate to a qualified charity, it may still be worth it to your taxes if you are in a position to donate enough to impact your taxes.

Make Sure Your Charitable Donations Still Count

If you want to check that your donation will be able to impact your taxes, you will need to consider your tax bracket and other deductions.

For example, say you are married filing jointly, and you fall into the 22% tax bracket. Your standard deduction is $24,000, so your itemized deduction will need to be more than that to make it worthwhile to itemize your taxes. Some of the most common itemized tax deductions are:

• Charitable donations
• Mortgage interest deductions
• Dental and medical expenses
• Local and state taxes

So, depending on how close your other itemizable deduction bring you, your charitable donation amount may be influenced.

For more tailored, hands-on help with your taxes and accounting needs, contact us. Our accountant will be happy to consult with you.

Including giving in your life provides a direct benefit to both society and your soul. There’s another advantage many people overlook. Your charitable donation can make a noticeable difference in the size of your tax return. This is particularly the case if you’re guided by an expert tax accountant.

It can be hard to decide which nonprofit to support, given there are so many organizations out there doing great things. It makes sense to start in your own backyard, assisting people in your community doing their part to improve the world.

One such organization is Turn Community Services, a Cedar City-based nonprofit that provides support for adults with intellectual disabilities and the people who love them.

Turn Community Services Provides Disabled Adults With Help, Hope

Turn Community Services was founded in 1973 by a group of Utah parents seeking better services for their adult children with intellectual disabilities. At the time, the typical course of action was for parents to place their child in a state institution or have them remain at home, with few opportunities for learning or social interaction.

The nonprofit’s first endeavors were to found residential programs in Ogden and Bountiful, group environments where clients can live in regular homes while receiving the support they need. More than 40 years later, Turn Community Services has expanded to provide a wide array of services throughout Utah. Its reach has grown to include 800 individuals and their families!

Residential Programs

People who live in Turn Community Services’ group homes are assisted with life and social skills and provided with community engagement. There’s a wide range of practical support available to residents, including management of medical needs and personal funds.

Art And Educational Day Services

Turn Community Services also has Art and Educational Day Services that give adults with intellectual disabilities an opportunity for self-expression. While clients learn and create in a safe space, their families can rest easy and pursue activities like work knowing their children are in good hands.

Turn City Center for the Arts in Salt Lake City is a prime example of how a day program can lend support and meaning to adults with intellectual disabilities. Clients at the center are given with instruction and materials to produce artwork. They can also take classes in pursuits like:

• Breakdancing
• Creative writing
• Drama, improv and musical theater
• Hapkido
• Percussion
• Singing
• Yoga

Day services clients produce some remarkable artwork. When it’s sold, a portion of proceeds goes to sustain the program and a portion goes to artists.

Summer Camp

Turn Community Services also offers ongoing summer camps, including one in Cedar City. These afford people with intellectual disabilities, age 6 to 22, with the chance for outdoor discovery and memorable community experiences.

Your contribution to Turn Community Services also helps fund programs like:

• Supported employment
• Family support and respite services
• Mental health counseling

If you’ve been wanting to include charitable giving in your financial plan but haven’t yet done so, it’s never too late to “turn” over a new leaf. Your donation to a nonprofit like Turn Community Services is just one of the many deductions that can bring you benefit when it comes to dealing with the IRS.

If you’d like help with tax preparation, Adrian D. Anderson of AA Tax & Accounting Services in Cedar City is ready to bring new expertise to your money matters, both personal and business. AA Tax & Accounting Services is also skilled in an array of other areas, including services like:

• Business consulting
• Payroll services
• Bookkeeping services
• Startup company planning
• Trust accounting services

Feel free to contact us with any questions or to set up an appointment.