Get the most from your accountant
Fall brings brisk mornings, the smell of wood smoke and the niggling thought that you should schedule an appointment with your accountant to prepare for year-end taxes. Marc Poulin, CPA and owner of Poulin Financial Services, has these suggestions on how to get the most from your accountant (and maybe save yourself some money in the process).
1. Review and organize your books before you meet
Sending your accountant a Quickbooks file filled with errors is the same as handing them a shoebox filled with receipts. Make sure your books are clean and correct before your meetings. The worst thing you can do to an accountant (and your wallet) is to ask them to clean up your books during tax season. Why pay your accountant over $100 an hour to decipher your financials at year end when you could pay a good bookkeeper $35 – $60 an hour to keep good records throughout the year? A good, clean set of books will provide you meaningful information during the year and make it easier (and less expensive) to do your taxes at year end.
2. Call your accountant during key transition periods
Tax issues can occur when you restructure your company, add a partner or get rid of a partner. Don't be afraid to contact your accountant when your business is going through transitions like this. Asking for advice before you make decisions can help avoid tax consequences later on.
Find out how to save on other big decisions. Think about calling your accountant before you refinance debt or buy a big piece of equipment. You don't do these things every day, so your accountant can provide advice on tax issues. He can also help you handle the accounting entries so your books stay clean and accurate.
3. Get advice before you start your business
The Internal Revenue Service and state of Maine ask financial questions on their registration forms, so you will be dealing with accounting issues before you even start your business. Contact your accountant early on (and even during the conceptual stage) for advice on bookkeeping methods, payroll decisions and other questions that come up during the startup phase. A short phone call can save you a lot of misery (and money) down the road. As your business grows, your accountant can also help you set up mechanisms for timely reporting of financial activities.
4. Ask for assistance with payroll issues
Running your own payroll can be a blessing or a curse — you can be in full control of all of your pay issues or you can be mired in innumerable details with heavy consequences if you make a mistake. Contact your accountant to ask about the pros and cons of running your own payroll versus outsourcing this task. Not only will she give you advice on this decision, she can also recommend a good payroll firm if you decide to use an outside company.
5. Consider your accountant as part of your advising team
You may not have an official board of directors, but your accountant can serve as an informal sounding board. Ask for his interpretation of your financial reports to see if your take on things is correct. An accountant that deals with many small businesses might be able to provide insight on problems that he has seen other companies struggle with.
Good accountants can provide advice during periodic financial reviews or when something unusual is about to happen. Contacting them can save you time during the year and money during the tax season…and who doesn't need more time or money?
Consultant Alison Hinson, owner of Alison Hinson MBA LLC, can be reached at ahinson@midmaine.com.
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