Starting your own business is a big step. Your mind is likely full of questions, and probably a healthy dose of both joy and fear. And who could blame you? Starting any type of business can be complicated, exciting, and downright scary. Whether you’ve already made your decision or are still on the fence about pulling the trigger, it always helps to make sure all your bases are covered. To that end, we’ve put together 5 key things you’ll want to consider when starting a business.

1. You need a business plan
   The value of a solid business plan cannot be overestimated. Your business plan will play an integral role in getting financing, and will also serve as a vital guide throughout this adventure. Even if you’re not looking for financing at the start, a business plan including marketing strategy, forecasts, and future goals can help clarify your purpose and vision. Make sure your business plan can convince others – and yourself – that your product is serving a particular need, and that there is an active market for it.
2. You can’t do it all
   No matter how advanced your education or how well you know your market, there is likely to be something you haven’t thought of, or some area where you lack expertise. And guess what? That’s okay! From finances, to marketing, to logistics, there are plenty of people and resources available to answer your questions or fill your needs. Don’t overlook outsourcing as a way to get meaningful help. Nobody can do everything alone, so don’t spread yourself to thin.
3. Set it up right
   Should you set your business up as a sole proprietorship? An LLC? S-corp? Partnership? If you’re unsure about what all of that means, it’s definitely time to get some advice. Consult with an attorney or CPA about which legal structure is the best fit for you. Depending on your situation, you may get a heap of tax benefits simply by using one business structure over another.
4. The tax man always cometh
   Before you actually start doing business, you’ll need a tax identification number. Why? Because you’ll have to register (according to federal and local laws), for things like unemployment insurance, worker’s compensation, and of course, taxes. Tax codes, deadlines, and determining your liability can be a complicated process requiring a tax professional.
5. Bookkeeping can be a bear
   Unless you’re an accountant, even simple bookkeeping can quickly become confusing. And no matter who you are, the weight of financial tasks can be overwhelming and distracting. Keeping your financials in order can take a lot of time away from things like product and business development, so be sure you’re prepared for that. As your business grows, it usually becomes necessary to let an accountant keep your financial statements, payables and receivables in order. Fortunately, most business owners are surprised at how affordable it can be to outsource this.

Businesses that are built on a solid foundation have a much better chance of success. No matter what type of company you’d like to start, it’s important to consider all of your needs and the complications they might present. Especially when it comes to finances and taxes, having all your ducks in a row is imperative to long-term viability. Since you’re sure to have questions, be sure to seek out qualified help.

No matter what type of business you’re in, one thing is certain: you’ll end up paying a significant chunk of your income to the IRS. Many individuals and business owners alike dread tax time, not just because they may owe additional money, but because of the complexities of filing correctly and the potential consequences of getting it wrong.

Not everyone uses an accountant or CPA to file their taxes, but all of us are required to file correctly and on time. It’s a source of stress for many. In fact, 40% of small business owners agree that taxes, together with bookkeeping, is the most unpleasant part of owning a business. Whether or not you use a professional is up to you. However, there are several things that can help you keep your tax prep up to snuff either way.

Avoid Common Errors

A few of the common mistakes business owners make with their taxes include overlooking self employment taxes, letting record-keeping slide, and failing to report income as stated on 1099s. There are many other oversights, but those are three of the biggest.

Know the Forms

Being familiar with all applicable tax forms is essential to accurate filing. If you fail to submit the proper forms, you’re likely to receive an unwelcome letter from the IRS — even if it’s years later. If you use contractors, you must use 1099-MISC forms. If you’re a sole proprietor, are you filling out a schedule C? The right paperwork for your situation will differ from someone else’s. If you’re unsure what to file, talk to a tax professional.

Speaking of Paperwork…

Paperwork and the IRS go hand-in-hand. If you’re going to file properly, here is a list of the most common documentation you’ll need to keep track of:

• Income documentation: gross sales receipts, returns and allowances, bank interest, and more
• Cost of goods sold (if selling products): inventory with dollar amounts (beginning and ending), materials and supplies, inventory purchases, etc.
• Expenses: office rent, computer equipment, mileage, hotels, advertising, internet service, depreciation, office rent, wages paid out (W-2 and W-3), employee benefits, and more. You’ll need receipts, bank statements, and other paperwork to document everything you claim.

This is by no means a complete list, but it should give you an idea of what you’ll need to hold onto. In general, if it documents your business’ money, keep it. Better to have more than you need than miss something that could affect your tax liability or trigger an audit — or worse.

When it comes to tax preparation, you cannot be too careful or too prepared. This checklist is a starting point, but it’s always best to get some help from an expert. That’s why most small business owners choose to use an accounting service — at least for that April 15 deadline. It’s an up-front expense that can save you a lot of time, headaches, and money over the long haul.

If you believe your business’ corporate structure may be resulting in more expense than value, it may be time for you to consider entity restructuring. This is the process of changing your legal structure (LLC, S-corp, etc.) into something that better fits your growth or other changes. Entity restructuring is an area where you’ll definitely need the help of a certified professional, but you might be worried about the cost.

There are a lot of factors that come into play during restructuring, such as tax liability, personal risk, and IRS filing requirements. It’s a complicated process that will be different for every business. This makes it difficult to estimate your expected costs with any precision. However, there are several elements that will influence how much you will pay. A few of those include:

• The size of your business — In general, the larger your operation, the more complicated the process, resulting in a higher cost.
• Your current structure — Some structures are more complex to begin with. Coming from a sole proprietorship will likely be less demanding than if you’re already an LLC or have subsidiaries.
• Their experience — It stands to reason that an experienced legal or financial team might have higher fees that someone who has little experience. But generally speaking, you get what you pay for.

Depending on these and other factors, your entity restructuring costs may amount as little as a few thousand dollars, up to several thousand. While it’s easy to understand why a lot of business owners might be reluctant to undertake restructuring because of the associated costs. But most often, if your company is really ready for a new structure, the tax savings by themselves are enough to justify the investment. You may also simplify your operations for greater efficiency, plus reduce any personal liability you may currently have. In fact, the restructuring service will often pay for itself within the first couple of years.

Ideally, you should conduct an evaluation of your business structure with a professional at least once per year. Regular monitoring can help you identify changes that could impact the fit of your current legal setup. As with many other business issues, the best way to evaluate your own situation is to consult a professional. They can help you evaluate whether your current structure is still the most beneficial. Weighing the pros and cons, they’ll work with you to identify your next steps should a change be warranted. If so, professional guidance ensures you’ll be well prepared for the transition.

We all have dreams; things we’d like to accomplish and lifestyles we’d love to pursue. Sadly, too many of us see our dreams as more pie in the sky than real possibilities. For example, many people dream about starting a business, but the potential risk keeps most of us from doing so. The difference between you and this majority is that you’re ready to actually go after those dreams.

Once you have a solid business idea, it’s time to get your other ducks in a row. There are many keys to a successful startup, but we’ve chosen 5 steps where all too many new business owners go wrong. The idea is to help you steer clear of common errors and help your startup stand the test of time. So let’s go!

1. Skip the market research
   If failure is what you’re after, then nothing is more effective than not doing your homework. Whatever you do, don’t conduct any market research before finalizing your business direction – because that can lead to absolute success! In all seriousness, market research is a MUST. You need to know that there is an active market for what you plan to offer. Who is your audience? How large is it? Who are your competitors, and are they well funded? Before you begin your venture, you need to understand what the market wants and needs from you, and how to reach out to them.
2. Go in blind
   Nothing ensures a rocky start like hitting the “go” button without a plan. Business planning is vital, and should include much more than a marketing strategy. Smart business planning requires the correct legal structure for your business (hint: you’ll need an attorney). You’ll also need a legitimate revenue model, accurate financial forecasting, and yes — a budget.
3. Don’t protect yourself
   There is no better way to go down in flames than to start your business without legal protections. Aside from setting up your business properly for tax and liability purposes (see number 2), you must put protections in place for your intellectual property. Make sure you have any licenses or copyrights required. Establish accounting policies and business accounts. Document business procedures. You must also take steps to protect your own assets from potential lawsuits that stem from your new status as a business owner. It happens — be ready.
4. Don’t raise capital
   Most of us can’t afford to fund operations ourselves, so you’ll likely need investors or even crowd funding to raise money for advertising, product development, etc. You must convince investors you’re a wise risk, then ensure those funds are properly used and accounted for.
5. Always go it alone
   Successful businesses are built by people who seek out solid partners for the early stages and beyond. Decide what roles need to be filled and what type of people should fill them. Define each person’s responsibilities. Make a plan to compensate your employees with a good payroll system. Third-party professionals such as accountants and attorneys can offer vital support as you start and grow your company.

Starting a business is exciting and fast-paced, much like a new roller coaster. While there are always unexpected twist, turns, and hills to climb, careful planning and quality support can go a long way to ensuring success and longevity.

If you’re one of many small business owners experiencing robust company growth, you understand how things can change with your success. The expansion of your operation is a great thing. However, growth comes with a new set of challenges. One of those challenges is making sure your legal business structure is appropriate for your business moving forward.

Expect the Change – But Get it Right

As your business expands, entity restructuring is one of those growing pains. Throughout this process, however, keep in mind that the way your business is set up in the eyes of the law has a domino effect on everything else you are able – or unable – to do. Tax liability, business loans, regulatory compliance, and your own financial liabilities rely heavily on having the proper structure in place.

Once your structure is set up, the last thing you want to do is start the process over again in a few years. Legally, this would be akin to re-starting your business from scratch. As you can imagine, this represents a major disruption in your ability to run your business and make a profit. Getting the restructuring process right the first time can help you avoid:

• Excessive taxes
• Loss of productivity
• Losing personal assets in a lawsuit
• Missing out on potential funding
• Auditing and accounting risk
• Legal and tax trouble
• Lots of stress

How Should My Business Be Structured?

Which business structure is right for you will depend on a lot of factors. How likely are you to be sued? Are you doing business internationally? Do you have business partners? What is your expected revenue? How many people do you employ? These and other questions will help you determine whether you should be structured as a sole proprietorship, LLC, partnership, corporation, s-corp, or something else. It’s a complicated process that warrants some personal attention from an expert.

Where Can I Find Help?

The only way to ensure the you’ve chosen the proper structure and set everything up the right way is to use an experienced attorney. They know the federal, state, and local requirements for doing business. They understand tax law, business and personal liability, and more. After all, it’s more than the success of your business on the line: it’s your financial well-being, your reputation, your personal assets — even your freedom to do business at all.

As you can see, entity restructuring has some far-reaching implications. If your business is growing and you’ve ever wondered about your current structure, call an attorney today to examine your current and future needs. You’ll sleep better tonight.

It’s said that with age comes wisdom– which I certainly hope is true. Though seasoned veterans of the business world still make mistakes, they have one large advantage– experience. If I could talk to my 20-year old self just setting out into the workforce, I would share these simple lessons that would save time, energy and a lot of headache.

Make a Detailed Business Plan First

Your business idea may be fantastic, but harness your excitement and use that energy to create a detailed plan. Your homework should include an in-depth look at the competition and how your product fits the market. On the financial end, you should gather enough data to show expected cash flow as well as showing potential risks facing investors who decide to join you. Spend time creating a polished executive summary showing clear objectives and direction for your company.

Hire A Professional Accountant

When you are serious about starting a business, consult a professional accountant to guide you toward the best financial structure for your needs. If you find the right accounting firm, they can also relieve you of bookkeeping, payroll, and tax preparation as your company grows.

Brand Yourself

Branding is in the details. From name, logo, and marketing strategies, each aspect of your company’s image should say the same thing. Developing your brand will make your company memorable and can increase profitability when matched with a great product.

Forget Pride and Ask for Help

You may be in a top-notch business school or perhaps you’ve helped run the family company for so long that you feel secure in your business abilities. Though education and prior business experience are helpful, don’t get over confident in your abilities. Recognize the value that lengthy experience provides and don’t be afraid to seek counsel from seasoned professionals. Depending on the issue, hiring a consultant may be advisable.

Be Real

Having confidence and enthusiasm are important qualities for business people but pretending to have every answer when you are clueless can make you seem fake and untrustworthy. A better approach is being optimistic but honest. A client or customer would much rather you admit you don’t have the answer but are willing to find it for them.

Don’t Take Rejection Personally

Success isn’t certain in business but rejection is. It’s a hard pill to swallow, but not everybody is going to be fond of your products and company. Though research shows the mind reacts similar to rejection as it does physical pain, consider negative responses to your company as an opportunity to reevaluate your goals and purposes instead of taking as a personal attack on you and your business.

Schedule Time Off

Burn-out is real. Though you may have more disposable energy in your 20s, making time for mental, emotional, and physical breaks from work is vital to your overall success. Find balance between dedication to the job and other aspects of your life.

Offering a great product, developing a detailed business plan, and designing clever marketing strategies are the fun part of starting a business. However, don’t overlook the importance of how you manage your accounting as a vital component to your long-term business success. Consider these common accounting mistakes made by small businesses and how hiring a professional accountant will help you to avoid them.

Choosing the Wrong Business Structure

From the onset, choosing your business structure involves crucial accounting decisions that will affect how you pay taxes. Hiring a professional accountant who is versed in IRS business tax categories will inform you of conditions you qualify for and risks associated with each model. Choosing the best tax category for your company can save you thousands in taxes and will affect your bottom line.

Missing Out on Tax Deductions

Think you know the tax system well? Since 2001, the tax code has changed more than 3,250 times. In one year alone, the tax code had over 500 changes. Though many small business owners have basic understanding of the tax system, they may be unaware of some of more subtle nuances of the tax code. Unfamiliarity with code changes can result in missing out on important deductions or lead to penalties. Hire an accountant whose entire job depends on staying up-to-date on tax code so you don’t overlook these money saving deductions.

Spending Hours Doing Taxes Instead of Focusing on Your Business

They say time is money and the same holds true in business tax preparation. Companies filing their own taxes can spend countless hours trying to navigate and correctly complete their tax forms. About 7.6 billion hours are spent every year on filing. It’s no wonder almost 75% of unincorporated businesses hire professionals to do their taxes. A well-trained accountant will know the proper forms for your business structure and will clearly outline what information they need from you before filing.

Only Considering Taxes When They Are Due

For many small businesses, the IRS expects estimated tax payments. Instead of paying a one-time tax in the Spring, these payments are required quarterly. A professional accountant will know whether your company is expected to file four times a year and help you complete the 1040-ES form used to calculate each payment. Your accountant will also help you determine how much extra money to set aside in case your yearly taxable income is higher than initially estimated.

Getting Tax Help From Someone Without Experience

Maybe you’ve already decided that it is best to hire someone to help you with your taxes. Before you trust anyone who says they are a professional tax preparer, get the details of their experience level and qualifications. Verify that the accountant has obtained a preparer tax identification number (PTIN) from the IRS. Choosing a proficient accounting professional can help you avoid these small business mistakes, saving you time, money, and headaches when managing your finances.

Many events, such as working on a car, dealing with medical matters or seeking spiritual help, require the insight of a professional. While you might think that you can handle finances on your own, research shows that you probably need professional help with money management as well. One study shows that investors who meet with financial planning professionals before making major money-related decisions wind up better off than those who don’t. Read on for five life events when you will need professional advice.

Receiving an Inheritance

According to Consumer Reports, up to 80 percent of inheritances are gone within 10 years. A windfall might only magnify bad financial habits. Whatever your spending style, a financial professional can help you create a plan for your new state of affairs that will keep you on track toward your financial goals, such as adjusting your retirement planning and managing new investments. Your financial adviser can further assist you with navigating tax payments, charitable contributions and more.

Starting a Company

If you’re launching a startup, you will need to focus on the daily running of your business, leaving you with little time to plan. In fact, 30 percent of small-business owners haven’t sat down to figure out how much money they’ll need to retire. Even if you’ve made plans for your retirement, you can likely benefit from advice on smart investing for the future. A financial planner can also help you with taxes and help you take advantage of available business loans and grants.

Accepting a Severance Package

When your employer offers you a severance package, a financial professional can serve as a valuable resource to provide rational counsel. Don’t agree to a severance package until you’re confident that you understand its details. In most cases, you’ll have 21 days to look it over and negotiate the terms. A financial adviser can also help you plan how to make the most of your severance package while you’re looking for new work.

Getting Married

People are waiting longer to get married these days than they did in past generations, which means it’s more likely that you’ll have accumulated financial assets and responsibilities before your wedding day. A financial professional can help you get all of your ducks in a row. Even if you’re just getting started in your career and don’t have any significant assets, talking through money-related issues before your wedding helps create a foundation of trust that can steer you away from quarrels in the future.

Expecting a Baby

A lack of financial planning now will have an effect that goes beyond just yourself and your partner since you are now responsible for a child. By planning sooner instead of later, you can save for baby’s college, plan for parental leave and budget for new expenses once your baby arrives. You may also want to take out additional life insurance. Plan before the baby comes so that you feel more prepared.

As a small business owner in Cedar City, you have refined your skills but have technically become a jack of all trades instead of the master of one. You find yourself distracted with accounting, payroll, legal compliance, annual statements, government reporting and taxes, which all keep you from doing what you love.

If this sounds familiar, then you need to hire a good certified public accountant to help increase your profitability.

Making the Most of Your Time

You are likely spending your valuable time at tasks that don’t relate to your area of expertise, which costs your business money For starters, think about the time you spend on tax preparation. If it takes you 10 hours to prepare taxes, and you generally charge your client $50 per hour to provide services, then it costs you $500 of productivity. That $500 only represents a starting dollar amount. It doesn’t include face time, your stress level or paying employees to do what you do.

Mastering the legal system requires study that steals valuable time, and time is money. It’s not just the time it takes to master the legal system, but the cost of mistakes as well. Small mistakes equal big money when it comes to both penalties and simple errors that you could avoid. One CPA reports that a larger client paid an unnecessary $4 million in taxes because of a preventable tax mistake. While this might be an extreme example, even a $4,000 or $400 loss is painful, especially when it’s unnecessary.

CPAs: More than Tax Preparation

So far, the tax and legal aspects might convince most small businesses to use the services of a CPA. However, additional reasons might further weigh on your decision. If you need a small business loan, you’ll need a business plan. You might have 80 percent of the funds that you need, but a CPA can fill the gaps to make your plan go from mediocre to top notch to secure that loan. Legal issues extend beyond taxes with government rules further complicating the process. Of course, a good CPA can help you navigate that difficult terrain, which will come in handy if you are ever audited – and you’ll need a CPA for that as well. A competent CPA can help with the following:

• Employee matters, including taxes, vacation accruals, direct deposit, retirement and more
• Business taxes
• Balance sheets
• Financial statements
• Annual reviews
• Profit-and-loss statements
• Business continuation plans
• Bank accounts and more.

Learn how a CPA Can Help Your Business

Your best bet is to call a Cedar City CPA to find out how he or she can help you. Organize a list of tasks, Estimate how much it costs you to accomplish said tasks, and make a phone call. While you might find out that you don’t need a CPA, you might learn that a CPA can help you grow your business.

Filing your taxes can be a hairy endeavor, especially if you try to prepare them yourself. There are lengthy forms to fill out, laws to understand, and plenty of paperwork and information to gather. Sometimes doing your own taxes seems like a headache that just isn’t worth it. That makes hiring a Southern Utah professional tax preparer even more appealing to many of us (especially if you own a business).

When you finally decide to go with a tax professional, you might have a lot of questions. Fortunately, there are plenty of people who are trained to answer those questions and take care of the filings for you. However, before you choose a tax preparer and begin the filing process, there are a few things you should consider.

The Homework

The main reason you aren’t doing your own taxes is because you want them to be done accurately, right? That makes it imperative that you choose a qualified and reputable tax professional to handle the process. Before agreeing to work anyone, makes sure you look into their background and experience. You should know:

1. How long they’ve been in business
2. How many returns they have filed
3. What kind of training courses they’ve taken
4. How long it’s been since their training
5. How available are they to you to answer questions
6. Will they help you if your return is audited
7. If there are any complaints against them (check the Better Business Bureau)

Do some research online, ask for referrals, and make sure you feel good about the tax preparer you hire. Also, make sure you’re aware of their fees. Usually, fees will vary depending on how complex your return is. However, it should never be based on the size of your return — that’s illegal.

Be aware that there could be extra charges for optional services, such as RALs (refund anticipation loans), additional IRS submissions, electronic filing, or expedited refunds.

The Groundwork

Before you visit with your tax professional, you’ll need the right documentation. You may have to ask your employer or check your mail for 1099’s or documents from your bank. This list doesn’t include everything you might need, but it’s a good place to start:

1. Last year’s tax return
2. Copies of cancelled checks for tax deductible payments (medical and child care bills, business expenses, moving expenses, business travel and more)
3. Cancelled checks and/or receipts for tax deductible charitable donations
4. Statements or receipts for mortgage interest, real estate taxes, and business-related transportation or entertainment expenses
5. Social security information for yourself, spouse, and any dependents (physical cards will help avoid errors)
6. Any mail or tax information you’ve received during the year from the IRS
7. Your employer-issued W-2 forms detailing income and tax withholdings
8. Statements of other income, such as 1099s, or other documents from financial institutions you’ve dealt with during the year

But What If I Owe?

Another thing to remember is that if you owe taxes that year, you are still required to file, even if you can’t afford to pay now. Your accountant can help you file IRS form 9465, which requests an installment plan. These installment plans are relatively simple to obtain.

Ready to File? Not So Fast

No matter which preparer you settle on and how confident you are in their ability, you should always review your tax return to ensure it’s error-free. Even an honest mistake can cost you more or get you into hot water. Never sign off on your documentation until you are sure it’s 100% accurate, and make sure you receive a copy of every filing. With a qualified tax professional by your side, your tax burden will often be smaller, and the burden of filing can be lightened considerably.