Atlanta CPA Provides Tax Tips to Accounting and Bookkeeping for Entrepreneurs

Atlanta CPA Provides Tax Tips to Accounting and Bookkeeping for Entrepreneurs

This is the Latest of A Financial Survivability Series of how you can look to the future by analyzing the present to help plan both short and long term for the future. Business Owners throughout Metro Atlanta will continue to be challenged as the U.S. economy strives to unlock itself from the economic frailties which still hold it down. Struggling with a Weakening Dollar, a High Jobless Rate, Limited Demand and Purchasing Power still have to overcome to get our economic steam engine back on track.

First and foremost in keeping your company legitimate is to make sure that you keep your personal expenses separate from your business expenses. To keep and maintain a clear delineation of your company from your personal affairs you should only pay business expenses out of your business/corporate account. Accordingly you will want to ensure that you only issue monies for your personal affairs out of your business and not out of your corporate account/monies.  

Secondly it is prudent to have a sound basis and understanding of what is, and what is not tax deductible and how to properly record and account for your business expenses and revenue. Below is sample letter of one that might be used to give a client insight and guidance on their tax and bookkeeping issues. For convenience I have recapped my answers to the inquires in all capital letters:

Hi John, I hope you and your family is having a great Christmas season. I am still working on the statements. Most of the work I have to do relates to figuring out the charges on my credit cards. 98% of the time my business card was only used for business expenses but I have had to go back through them to try and figure out the category of the expense. To make matters worse, I have transferred balances and opened new accounts and so forth so I have had to chase down the original transactions. Here are some questions I had.  

1) Categories. I guess this is also referred to as my chart of accounts. I know you want me to put a lot of things in Office Supplies but I wanted to check on these because I wasn't sure if Office Supplies is where you wanted them.

a) Client gifts: Christmas gifts or just sometimes purchasing them a piece of equipment or something. I also remember something about $25 being the maximum per client each year so if this is true where should the rest of it go? $25 IS THE LIMIT AND THE EXCESS WILL GO TO SHAREHOLDER DISTRIBUTIONS

b) Referral fee: If a client refers another person I write them a check for between $50 and $100. ADVERTISING

c) Internet education subscriptions: I pay a monthly fee to access articles and forums relating to fitness. I am a member of 2 of these sites which charge around $10 per month. TELEPHONE & UTILITIES

d) Water Delivery: I have bottled water for my clients to drink. TELEPHONE & UTILITIES

e) National Memberships: I have 2 certifications that I maintain annually for about $100 to $200 per certification. OFFICE SUPPLIES  

2) What if I charged my credit card for some gas and then paid that credit card out of my business account but the gas was not a business expense? IF YOU PAID THE CREDIT CARD PERSONALLY THEN YOU WOULD JUST NOT LIST IT AS YOU ARE RECORDING BUSINESS EXPENES NOT YET REIMBURSED.  

IF YOU PAID THESE DIRECTLY OUT OF THE BUSINESS AND WAS FOR GAS, AS YOU WILL BE DEDUCTING MILEAGE, YOU SHOULD CODE THESE TO SHAREHOLDER DISTRIBUTIONS.  

IN THE FUTURE I WOULD SUGGEST PAYING ALL CAR EXPESES PERSONALLY AND THEN TURNING IN A MONTHLY EXPENSE REPORT TO GET REIMBURSED FOR ANY BUSINESS EXPENSES PAID PERSONALLY  

John Dillard is a Christian Speaker/Author and Certified Public Accountant (All Rights Reserved). To See how he takes Christ along with him to work visit http://www.hiscpa.com/  (An Atlanta CPA firm) and for his latest book Overcoming Life's 9/11's: Job's Journey and to learn about his ministry visit http://www.john-dillard.com/  To contact John Dillard CPA (Atlanta Christian Author/Speaker) today call 770. 814.9304 Proudly serving Duluth, GA, Gwinnett County and Beyond.  

"Dare to Attempt Something so Great for the Kingdom of God that it is doomed to failure, lest Christ be in it!" What, then, shall we say in response to this? If God is for us, who can be against us? Romans 8:31 Why are these verses here? Learn how His CPA became a Christian Accounting firm visit http://www.hiscpa.com/christian-CPA.html