It’s our goal to have your reports to you by the 15th of each month, or the business day prior.

Ideally, we will have accountant read only access to all of your bank accounts so we can pull statements on your behalf.

We aim to have questions to you as early as possible.

Your timely response allows us to turn your books around by our promised date of the 15th of each month.

Delay responses lead to delayed reports.

Please do your best to answer promptly so we can ensure timely reports so you can make better business decisions.

If you prefer one form of communication over another, just let us know and we’ll do our best to honor that.

Delays:

If reports are delayed beyond our internal deadline of the 15th, we will send a status update. If the reason is due to incomplete information from the client, we will let you know what is missing.

Once this status email is sent, we won’t send any additional follow ups and we will be waiting for the information necessary to complete your books.

The first half of the month is when we are laser focused on our clients and getting their reports turned around. The last half of each month is when we focus on the aspects of the business outside of existing client work. We can be busy in other projects or even off during this time.

Because of this, if information is received during the last half of the month, it may take up to 5 business days for us to turn the information around.

Alert us if you:

• Open a new credit card or bank account

• Change banks

• Begin selling physical products

• Hire any new staff

• Apply for or receive new loans

• Accidentally pay a personal expense from the business

• Accidentally pay a business expense personally

Our rates are based on the time it takes to complete your books, and not your income.

Rate are subject to increase with written notice and upon your acceptance. In the event of an increase, you will be notified of the amount and the date it goes into effect in advance and with your consent.

We dislike busy work, so most of the time, we will be happy to brainstorm ways to work faster and keep your bill down. To make that work, we need your flexibility and willingness to implement efficient systems.

However, we do understand when the priority is maintaining your system and dealing with the inefficiencies on the books. And we’re open to doing that work, but absent an efficient system, the bill is subject to increase and we will discuss the increase then.

Things that can trigger rate increase, aside from general inflation, are:

• manual processes (example: keying in each transaction versus a bank feed, coding items of income one at a time in a separate platform)

• increase in volume of transactions that adds time (sometimes an increase in volume doesn’t add time)

• granular detail of reporting (example: showing you detail by project or division)

• an increase in how many accounts you have

• management of inventory, payroll, or sales tax

It’s important to keep business and personal separate for several reasons.

The one that affects our relationship most is that it makes it exponentially easier to track. That means fewer questions, less guesswork, reduced room for error, and time saved which means a lower fee and more accuracy.

But it’s also a good practice and would help you in the event of an audit.

That means you should pay personal expenses from your personal account and business expenses from your business account. If cash is tight on either side, transfer between accounts.

If you accidentally pay a personal expense from a business account:

We will typically code it as owner’s draw and it will not count as a business deduction. If this is an autopay item, please correct the billing account.

If you accidentally pay a business expense from a personal account:

We have no way of knowing unless you tell us. That means you miss the ability to deduct what you spent. So just shoot us an email letting us know the date, amount, and vendor and we will enter it in your books. You can also reimburse yourself by writing a check or transfering from your business to your check with a memo and telling us it is a reimbursement. If you don’t tell us this was done, it may accidentally get coded to owner’s draw which means you miss the deduction.

We kindly request you keep this to a minimum as it creates more work and an ineffcient process with more room for error.

Fun Fact: estimated tax payments and payments on your personal tax return are actually personal expenses and are not deductible. If you pay them from your business we will treat them as owner’s draw.

Long story short: receipts are a client responsibility and used to back yourself up should you ever get audited. We don’t manage your receipts and we won’t ask you for them.

Below are some tips for storing receipts:

You can use a system like Dropbox or Google Drive. Keep it super simple by naming each receipt with the naming convention DATE-VENDOR-AMOUNT. That way if you are ever audited, you can find the receipt quickly at a glance without sorting through.

Example: 2024-09-01 Office Max $101.53

Determining if a new hire is an employee or contractor is not a choice. It’s a matter of which one the IRS would determine them to be and ultimately it comes down to control.

The IRS has a 20 point test to determine if someone is a contractor or employee.

Click here to read an article breaking down the 20 point test.

If you hire an employee you will need to register with your state and begin running payroll. I recommend using ADP or Gusto. We can chat to determine what is best.

If your hire is a contractor, it’s best practice to obtain a W9 from them upfront. You can do this by sending the form and retaining for your records.

You should pay them in a way that either prepares the 1099 for you (a payroll system) or allow syou to not need to file one.

You can email me to help you decide, but here are my general recommendations.

Payroll systems will handle the 1099 for you and allow you to send payment to your contractor. They have monthly fees. If you’re paying yourself a salary as an S corp owner anyway and this person will be ongoing, this is a good way to pay.

To avoid having to issue a 1099 at all, pay via a third party processor. This may happen if your contractor invoices you through a payment processor like Stripe, Dubsado, Honeybook, Wave, QBO, or Xero. In this event you do not need to file a 1099-NEC because the payment processor will issue a 1099-K if requirements and thresholds are met. This would be the method I would recommend.

For the most part, you are able to deduct expenses you pay from your business for the purpose of generating income that are necessary and ordinary in your line of work.

It gets tricky when the expense can double as a personal expense.

If you have a question about deductions, you can email me. I will likely defer to your tax preparer for the final decision but am happy to chat it through specifically.

If you tell us something is a business expense, we will take your word at faith.

Our engagement does not have us auditing your books - we are simply recording the information and answers you provide to us.

That means if you tell us something is a business expense but it is not, the onus lies with you.

If you take the standard mileage deduction (see Business Mileage below) you cannot also write off gas.

Clothing for photoshoots is not a business expense if it can be worn personally.

Meals can be deducted if there wa sa business purpose, but a family and friends dinner or your morning coffee cannot.

If you have taken non-business expenses as business expenses and therefore underreported your taxes, you maybe be subject to having to pay the tax you should have paid, plus penalties, interest, and the cost of representation under an audit. You should consult with your CPA regarding deductions and also understand your responsibility and risk.

There are two way to deduct auto expoenses.

The actual method - allows you to deduct the business use percentage of actual auto expenses including gas, maintenance, insurance, and lease payment or depreciation. The business percentage is found by tracking all miles and dividing business miles by total miles driven.

The standard mileage - allows you to deduct 58.5 cents per business mile driven. This means that for each 2 miles you drive you can deduct more than $1 worth of income and save money on your taxes.

I recommend the standard mileage method because it’s less complex and less likely to get audited if you’re doing it yourself. If you’re working with an accountant, it’s a good idea to ask them which one is right for you and exactly what you need to do to take the deduction.

You need to log miles in either scenarios. Tracking your miles is simple. You just need to note the date of your trip, where you went, the business purpose of the trip, and the miles driven.

The best time to log miles is when they actually happen so you don’t forget or have to go back and figure it out later. I drop my destination in my GPS and take the calculation from the round trip and drop them in my mileage log and then forgot about it until tax time when I can take the information off my log and use it to save money in taxes.

What counts as business miles?

Simple! Anything that you’re doing for business.

Examples are:

• business meetings

• networking events

• shopping for office supplies

• trips to the post office

What doesn’t count as business miles?

Commuting does not count as business miles. Commuting is going from your home to your regular place of work. So if you rent an office or work for one client and make the same trip daily, that is not counted as business miles. Traveling between clients or to different clients does count.

Something to keep in mind!

If your’e choosing the standard mileage method, you don’t pay for gas, oil changes, auto tag renewals, or car payments from your business. Those are all included as an estimate in the 58.5 cents per miles that you are allowed to deduct and claiming both can get you in trouble.

What is NOT included in the standard mileage rate that can be included is parking and tolls so be sure to pay for those from your business account when traveling for business.

The greatest way to say “I love you” is by referring your friends who could use a good accountant!

Just send them to my quote form and tell them to put your name in the field for “how did you hear about us?”

If they sign on for services, I’ll send you a $100 visa card when their first payment is made.