fbpx
, ,

Bookkeeping

Bookkeeping is vital to any business. Everything a business does financially should be recorded for official record. Tax records, financial statements, receipts of purchase, and ledgers should be organized and stored. Record keeping is vital to business success, and here are a few reasons why.

Audit

No one likes an audit. But the more prepared you are for an audit the better. If you have all of your financial documents in one place, an audit goes quick and easy. Oftentimes, what gets audited are small discrepancies that diligent bookkeeping can, hopefully, clear up easily. An audit takes your attention away from your business, and causes unneeded anxieties and stress. If you do get audited, the IRS will request all of your applicable records, so make sure that you have everything ready to show them.

Deductions

Tax deductions are important. At tax time, it’s important that every dollar your business spends, gets noted at the end of the year. Each and every dollar counts. This applies to businesses as much as it does to individuals. Keep track of every receipt! If the IRS ever questions an expense, you will have the evidence to back it up!

Tax Time!

At tax time, you will have all the required paperwork ready. If your books are well kept, up to date, then everything at tax time should go quick and easy. You don’t want to have to scramble at the end of the year for all of you tax documents.

If you have any questions as to how to keep diligent books, or would like the assistance of a qualified accounting and tax professional, then Practical Taxes is here to help. At the end of the day, wouldn’t it be nice to have someone qualified have your back? Wouldn’t it be beneficial at the end of the year to have your business in the hands of the reliable services of a tax professional who understands your business’s needs? Practical Taxes is ready to help, and can customize accounting services to fit all your needs. Call today to schedule an appointment.

/100 Comments/by
, , ,

Marketing

If you own a small business, you know just how important the standard tax write-off is. What you may not know is that marketing costs are win-win write-offs for every small business. Every small business needs to standout, meaning that every small business should be doing everything in their power to get out their name and then to keep their name in their local community (or local online community—i.e. Etsy). And the expense that comes from marketing a business is directly related to a future write-off on your taxes. Now, this isn’t to say that everything you do will lead to a write-off. The IRS believes that all tax write-offs should be reasonable in amount, and directly related to your business (How it’s related could bristle the hairs on the back of an IRS agent’s neck). Here are few ways to market your business that make for simple, straight-forward write-offs at the end of the tax season.

A new or up-to-date website

The rules and designs of the web change almost monthly. Google has new rules for keeping websites at the top of search engines, and customers have come to expect proficient designs that are easy to navigate. So, hiring someone (or, if you yourself have the spare time and experience) to update your website, add to its design, or shake things up. If there are any fees involved to host the website through a third party, these may also be accounted for. Also adding premium services so that your website runs smooth and efficient.

The Google Search Words Campaign

Many businesses spend exorbitant amounts on google ad-words, search terms. These can add up quickly. At the end of every month google should provide you with a receipt from the month’s transactions—this data is also included in your Google analytics package, however, just to be safe, don’t wait until tax season to save this data, in case anything were to happen.

Flyers

A marketing flyer is still be an effective marketing strategy in the digital age. Or a personalized Christmas card from your business to your customers at Christmas. Oftentimes, things like flyers, cards, and letters are easily deductible. Keep every receipt!

If you need advice as to which potential deductions will benefit your business, Practical Taxes is here and ready to help.

/by
, ,

Payroll Services

Did you know that it’s becoming ever-more popular to outsource payroll to an accountant service? It’s true, payroll is the number one thing businesses will outsource. There are many reasons including, cost, productivity, accountability, legality, and service.

Cost
Small businesses can absolutely save money by outsourcing payroll. Add up those hours spent on payroll and then calculate the costs to the company. Most times—especially for small businesses where each minute of the day could be filled with some type of progressive work—the outsourcing of payroll is considerably less than the cost of doing it internally. Oftentimes this is because accountants oftentimes use more sophisticated software than a typical small business, and accountants have the job streamlined.

Productivity
If you own a small business you will grow to appreciate the freedom that freeing up internal sources from the job of payroll will provide. You get to focus on the job you want to do, which is especially important for new businesses, not yet established—in today’s world the percentage of new businesses that fail is staggering.

Accountability
Did you know that a high percentage of small business pay a penalty to the IRS every year for improperly filed payroll taxes? Hiring an accountant at Practical Taxes makes sense, when you consider that they understand the ins and the outs of current tax policy. This also goes hand in hand with legal compliance. Because a payroll service like Practical Taxes is going to understand the continually shifting laws and obligations involving payroll.

Service
In today’s modern world you can find just about anything on the internet—including a payroll service! Regardless of how reputable companies are, isn’t it best to have an accounting service such as Practical Taxes with whom you can work, face to face in some cases, and trust all that important paperwork and sensitive documents to a responsible face. If you have any questions as to how Practical Taxes can help your business grow and succeed, be it with the outsourcing of payroll or the general everyday management of your business, call today.

/1 Comment/by

Charitable Contributions

Happy Thanksgiving! This is the time of year to be thankful, and, for some of us, this time of year has us thinking of giving back, making charitable contributions. Charitable contributions to those of your choosing are obviously very important, but it’s also important that you make those contributions in a way that also benefits your taxes. For those of you who don’t know, charitable contributions can be assessed as deductions on your tax bill! Giving is important and the government recognizes your charitable donations as a private citizen, but, it does impress upon you a few stipulations to receive the deduction on your taxes.

First, the charitable contribution needs to be to a qualified organization. You cannot deduct donations made to individuals or to political campaigns. Also, many contributions to organizations are met with gifts from said organization: consider an outdoor organization at who’s benefit dinner you wind up winning some grand prize because of your donation: the amount you can deduct from your taxes may only be the balance between the fair market value of the gift given to you by the organization and the amount of that year’s donation. If the fair market value of the gift exceeds the donation, then you’re out of luck at tax time. Also, to deduct the contribution you made, you must keep the receipt of the payment you made. The IRS doesn’t want to see a hand written sheet from So-And-So, claiming that you paid them some money; it wants to see receipts, receipts which, if needed, can be tracked back to a source. Non-cash donations are also considered contributions which can be written off, however, in order to claim the contribution on your taxes, for a contribution totaling over five hundred dollars, you must complete a separate IRS form, IRS form 8283, and, if you have trouble understanding the form, Practical Taxes is ready to help.

/3 Comments/by
, , , ,

Reasons Why Small Business Owners Need to Keep Meticulous Records

Being a small business owner, I get it, there is so much to do and keeping track of records just isn’t at the top of the list. But it should be. Keeping things organized and tracing records can help you in the long run.

Tax Season Billings MT
If you keep track of your records and receipts, when it comes to tax season, it will be much easier for you to locate your receipts. It will also help you to get all of the deductions that you are entitled to. The IRS does not accept bank statements. They want the actual receipts to validate your expenses.

Payroll Management Billings MT
Keeping your payroll records organized can assist you with tracking your employees. It makes it much easier when it comes to paying your employees. If you aren’t comfortable doing payroll or just don’t have time, Practical Taxes can manage your payroll for you.

Invoicing Billings MT
When it comes to invoicing your clients, keeping track of your records will help you to know who has paid and who has not. It can also help you to keep track of projects and to know what money is coming in.

Trust me when I tell you that spending a few minutes each day on your records will pay off in the long run.  Keeping track of your records will make tax season much easier as well.

Practical Taxes

Practical Taxes is a full service accounting firm in Billings, Montana. We can help you get the most from your taxes, and make sure that you will get the maximum refund every year. But we don’t just do taxes! We can help with your bookkeeping, payroll, bank reconciliation, budgeting, and more. Give us a call at 406-894-2090 to learn more.

 

/43 Comments/by
, ,

Business Expenses

It’s difficult to run a business, let alone a small business.  For most small businesses every dollar saved counts.  It’s important that a small business owner understands that there are expenses that they can write off at tax time (a write off simply being a deduction to your taxable income).

For something to be deductible, according to the IRS, it must be both ordinary and necessary to the business.  They define an ordinary expense as one that is common for the business, and a necessary expense as one that is both helpful and appropriate to the business.  However, there is some leniency when considering an expense to be necessary.

Necessary means that the expense was helpful to a business; the expense does not have to be considered indispensable to the business to be considered necessary.    These expenses should be documented with a receipt of payment. In the case of vehicle mileage, a documented travel log for all miles traveled while on business.

Business Expenses

There are many different types of business expenses, however, the following are the most common expenses that are linked to most any business.  To use your home as a place of business allows you—in most circumstances—to deduct expenses for the business use of it.  These expenses could include the home’s mortgage interest, home owner’s insurance, utilities, and depreciation.

Also, your car, whether it was purchased to be intended for business use or not, if it is being used for business, you can deduct certain expenses from your use of it.  If the car is used for both personal uses as well as business, then you will be able to deduct the mileage of the car while it was in use for business purposes.  Any other business expense such as insurance, retirement, rent or lease payments, interest accrued from the amounts you’ve borrowed on the business and the taxes on the business.

If you are a small business owner, consider hiring an accountant to advise you on your business expenses.  Also, remember to document every expense, because, when it comes time to pay your taxes, each deduction might mean more money in your pocket.

Practical Taxes

Practical Taxes is a full service accounting firm in Billings, Montana. We can help you get the most from your taxes, and make sure that you will get the maximum refund every year. But we don’t just do taxes! We can help with your bookkeeping, payroll, bank reconciliation, budgeting, and more. Give us a call at 406-894-2090 to learn more.

 

/4 Comments/by
, , , , ,

Increase Your Income by Earning More on the Side

Side-Job-300x225There are thousands of people who would like to make more money or save more money. It would allow them to afford the lifestyle that they truly want. But they run into problems, such as they are at the top of where they can get to at work, or they have scrimped and saved and really cannot cut costs anywhere else. They wonder where they should turn. In today’s society, packed with internet bills, cell phone bills, high utility fees, and many other things that cost a lot of money, many people need to pick up some sort of side income. Depending on how you earn the money, there could be tax consequences that you want to address (also where an accountant in Billings, Montana could help you out).

 

Getting a Second Job

To bring in extra cash, most people will get a second job. This could be serving at a bar or a restaurant in the evenings, or working part-time as a cashier at a retail store. There are the goods and the bads that come with this choice.

The benefits of a second job are that you will have regular hours. That means a steady second paycheck. Also, you will get another paycheck where taxes have been taken out; there will be less to worry about come tax season (on top of that, the employer will pay half of your FICA taxes).

The downsides, however, are that you are stuck working for someone else. You have to follow their hours, their guidelines, and you are likely to be stuck making close to minimum wage (being a server, however, you could make substantially more because of tips).

Working on the Side

Because of the lack of flexibility and the low pay of working a side job, many people choose to follow their passions, and monetize their hobbies or interests. This method takes a little more planning, but the benefits in the long run are a lot better.

The best part about starting your own side business is that you get to set your hours. You work when you want to, and as much as you want to. So if you only have a few hours per week, you don’t have to rearrange your entire schedule just to bring in some extra money. Another positive aspect is that you get to set your own rates. With proper marketing, and if you have the skills, you can make substantially more than minimum wage.

The biggest drawback of earning income on the side like this is that you will have to pay all of the taxes. Next tax season you will have a bigger tax bill that may drop your tax refund into the negatives. This is especially true because you will be paying ALL of the 15.3% into your FICA taxes (working for someone else, half of this is covered). Combine that with the fact that you have to find all of your own clients, and many people are deterred from this option (even though you can make a lot more, it is quite a bit harder).

Using an Accountant in Billings, Montana

If you hire an accountant in Billings, Montana, you will be able to take a lot of the worry away from your side business. Here at Practical Taxes, we know the tax laws, and if you are starting your own side business we can work with you to get the most deductions possible (and help to offset those taxes that you have to pay).

If you are interested in making more money on the side, consider starting a little side business (often called a side hustle). You will be happy that you did, and the extra income can go a long ways.

Practical Taxes knows all the current tax laws and can help you with your business needs including business planning, accounting, tax preparation, and more.

/14 Comments/by
,

Reasons To Hire An Accountant

It is June, which means that the busy tax season has dwindled.  But, accountants are still busy at work, because aiding and preparing tax forms for customers is not the only responsibility of an accountant.  Accountants are busy helping businesses with tax preparations and things like payroll.  And if you own a small business and are looking for some assistance from an accountant, Practical Taxes is here to help.  If you are a small business owner and you have never considered hiring an accountant to assist you, here are a few reasons why you might consider it.

Depending on how many people you employ, figuring out the payroll consumes your time.  The time in which you are doing payroll cuts into either your work time or your free time or both.  The question is, would it make better financial sense if you could work more, or would the cost of an accountant be worth the time to which you could regain your free time.  Also accountants are familiar with our state’s payroll laws.  Also, an accountant can provide real advice as to future expenditures you plan to grow your business.  Also, an accountant can work with you to track you business spending throughout the year: a second opinion can be a valuable thing for your small business.

Reasons that you may want to hire an accountant

There’s plenty of reasons to consult with an accountant outside of tax season, and here are just a few for example.  Consider a purchase in real estate, or say you are setting aside a large chunk of money for your children, or maybe you’re just going to give someone a large gift, be it money or house or car, etc.  An accountant can help you to navigate the required taxes, or set up spaces in which you can protect assets from being dually taxed.

An accountant, while being a very good asset at the tax season, is a good person to call with other financial questions.  A good accountant may be able to save you both time and money in your small business or even in your own personal finances.

Practical Taxes

Practical Taxes is a full service accounting firm in Billings, Montana. We can help you get the most from your taxes, and make sure that you will get the maximum refund every year. But we don’t just do taxes! We can help with your bookkeeping, payroll, bank reconciliation, budgeting, and more. Give us a call at 406-894-2090 to learn more.

/3 Comments/by

Invest in Yourself with an IRA

IRA-300x199When people think of retirement, they generally think of a blissful time where they have no money worries, they can travel the world, and they can enjoy their golden years. But studies have shown that not only are people ill prepared for retirement, but a full one third have not saved ANYTHING. If you would rather be one of those that are well prepared for retirement, and thus able to actually enjoy your golden years instead of scraping by on Social Security, then you need to start an IRA.

What is an IRA?

There are actually two forms of Individual Retirement Accounts. There is the traditional IRA and the Roth IRA. Both will help you store up money that can be used later in life, and both have particular tax advantages.

Both a traditional IRA and a Roth IRA are retirement accounts. These accounts are not specifically savings, CD’s, investments, REITs, or cash accounts. They are just the shells that determine how much you can put in, when you can take it out, and how the money is taxed. Just about any form of money can be stored in an IRA, and how you do that is up to you and your financial planner.

The money that is invested into an IRA, regardless of which type, can only be withdrawn after the age of 59.5 years of age (there are certain provisions, but these accounts are retirement accounts so we will ignore those provisions for now). The money will grow tax free or tax deferred, and then it can be used during retirement. If you take the money out before you hit 59.5 years old (or basically before you’re 60), then you will be assessed a 10% penalty by the IRS.

Traditional IRA vs. Roth IRA

Most people will be better of using a Roth IRA if they meet the income requirements.

A Roth IRA is funded with money that you have already paid taxes on. This means that you make $40,000 per year and you pay taxes on that full amount. Out of your take home pay you can put into your Roth IRA as much as $5,500 (for tax year 2014, this will increase in future years). Once the money is in the IRA, it grows tax free (rate of growth depends on your investment choices). After you are 60 years old, you can sell those investments and withdraw the money. Since you already paid taxes on it, any money that you take out is tax free.

A traditional IRA works a little differently. You can still only put in $5,500 this year, but the money is deducted off your income. So if you made $40,000 and you fully funded your traditional IRA, you will only pay taxes on $34,500. The caveat is, however, that you will eventually pay taxes on the money. Anything that you withdraw from your IRA is taxed at your current tax rate (that is the rate during the year which you withdraw the money). Plus, there is one more detail. Once you hit age 72, the government requires that you withdraw some of the money. These required minimum distributions are designed so that, based on your life expectancy, some money comes out each year.

IRA’s are a great way to invest in yourself. And let’s face it, the way Social Security is going, there may not be nearly enough left to cover your living expenses. So before it gets too late for you (investing early is always better than investing late), start up your IRA. Talk to a financial planner about the best option for you, and get your money into the market. Your retired self will thank you.

If you are looking for an accountant in Billings, Montana, Practical Taxes is where you should go. Practical Taxes knows taxes, business, and everything in between.

Practical Taxes

Practical Taxes is a full service accounting firm in Billings, Montana. We can help you get the most from your taxes, and make sure that you will get the maximum refund every year. But we don’t just do taxes! We can help with your bookkeeping, payroll, bank reconciliation, budgeting, and more. Give us a call at 406-894-2090 to learn more.

/1 Comment/by

A Few of the Most Often Overlooked Tax Deductions

Hand over keyboard of the laptop in server room

The end of the year is drawing to a close, and it’s time for many people to start thinking about their taxes. If you are in the habit of doing your taxes yourself (which is great if you have a simple tax return; if it’s more complex you would probably be better suited having an accountant in Billings, Montana look it over), then you need to know about all of the deductions that you may be eligible for. While it is easy to remember charitable giving and interest on your home mortgage, here are a few that you may overlook.

Gambling Losses – Nobody ever likes to lose money while gambling. But there is a silver lining. If you are out on the town and you stumble into a casino after a few too many beers, you can deduct the losses from your taxes (it goes both ways: if you win money you are supposed to claim it as income as well). Now there are a few provisions.

If you try to claim that you lost $10,000 gambling one night, but you have no way to prove that you lost $10,000 gambling one night, you might be in a bit of trouble. But if you bought $250 worth of scratch off lottery tickets, and you only won $50, you can deduct the $200 as a loss. As with everything tax related, keep your receipts so you can back up your claims in the event of an audit.

School Loan Interest – Not only can you get a tax credit for going back to school, you can also deduct the interest that you paid on those loans. Depending on how advanced your degree is, how expensive a school you went to, and how high your interest rate is, that interest could add up to a tidy sum.

This is one of the easiest deductions to get, since those handling your loans should be sending you a tax document in the mail every year. But if you are like most people who have recently graduated, you have probably moved around a bit. If you don’t remember getting your 1099-E then check with your loan manager to make sure they have your proper address.

Phone Bill – If you use your cell phone for business related purposes, you can probably write off a portion of the bill. If the phone is 100% used for business you can write off the entire thing, but if you use it to text friends and family, upload pictures of your totally sweet vacation to Facebook, or Snapchat with your best buds, then you should only take a partial deduction.

The same goes for internet and computers as well. If you have a work computer, then you can write off the purchase price. If you work from home, then your internet bill can be deducted (actually, if you have a home office, then you have a whole lot more deductions at your fingertips).

Getting the most out of your taxes is a bit tricky at times. It boils down to knowing the tax law, knowing which deductions are available to you, and being able to accurately claim them. If it all sounds like too much work, then you should probably hire an accountant in Billings, Montana to do that for you. Chances are, using the services of an accountant will actually get you a bigger refund (even after accountant expenses) than you realized you could get.

Practical Taxes

Practical Taxes is a full service accounting firm in Billings, Montana. We can help you get the most from your taxes, and make sure that you will get the maximum refund every year. But we don’t just do taxes! We can help with your bookkeeping, payroll, bank reconciliation, budgeting, and more. Give us a call at 406-894-2090 to learn more.

/1 Comment/by

Check Your Refund Status

Click here forFederal Tax Refund
Click here to find your State Tax Refund

Copyright ©2022 Practical Taxes, Inc. All rights reserved. Privacy Policy
Website Design By authenticimaging.com
 

Practical Taxes Heights Location

895 Main St. Unit #5
Billings, MT 59105
Telephone: 406-969-2760

(Tax Season Hours)
Monday – Friday: 9 AM – 5 PM
Saturday: 9 AM – 5 PM
Sunday: Closed

(Non-Tax Season Hours)
Monday – Thursday: 9 AM – 4 PM
Friday: 9 AM – Noon
Saturday & Sunday: Closed

Practical Taxes Westend Location

2201 Grand Avenue
Billings, MT 59102
Telephone: 406-894-2050

(Tax Season Hours)
Monday – Thursday: 9 AM – 6 PM
Friday: 9 AM – 5 PM
Saturday: Noon – 5 PM
Sunday: Closed

(Non-Tax Season Hours)
Monday – Thursday: 9 AM – 4 PM
Friday: 9 AM – Noon
Saturday & Sunday: Closed

Follow us on Facebook

This is a notification that can be used for cookie consent or other important news. It also got a modal window now! Click "learn more" to see it!

OKLearn More