Owning a business gives you the freedom to make your own decisions while reaping the full benefits of your hard work. There are, however, a broad range of responsibilities associated with running a small business, and meeting these requirements is necessary for staying within the limits of the law and your sanity.
For years, my business partner and I handled everything related to our finances on our own. It was time-consuming and stressful. We had it in our minds that it made more sense to do it on our own to try and save money rather than paying someone else to do it. Unfortunately, that is an all too familiar mindset that small business owners get stuck in because we want to keep as much money in the business as possible. However, it’s not always the best decision for the business. We finally decided to take the plunge to hire an accountant and a bookkeeper. It’s one of the best decisions we’ve made for our business! We are seeing a return on investment and it allows us to focus on the work that needs to be done to keep us up and running.
Accountants are beneficial to your small business because they help to minimize your chances of experiencing an audit and submit the paperwork you need to stay compliant with regulated industries. You can also use an accountant to increase the profitability of your business by forecasting future performance and planning an effective tax strategy. Overall, accountants are instrumental partners for running a sustainable business in any field.
Save Time by Delegating Responsibilities
One of the keys to success in business is to understand how to get more work done by delegating responsibilities to experts. Specialists ensure that work is completed in the right way while reducing turnaround time. Accountants are highly specialized professionals who complete extensive formal training before starting their careers, and they learn even more about their field after accumulating years of experience. Few business owners can match an accountant’s level of knowledge in key fields, such as compliance, forecasting, or tax law. Responsibilities associated with accounting are the cornerstone of running a legal and profitable business, so delegating these tasks adds significant value.
Comply With Complex Tax Laws
The U.S. tax code is so extensive that it can nearly fill an entire library. It is impractical to learn all the tax laws on your own while managing the wide range of other responsibilities associated with running your business. Accountants possess a thorough understanding of the tax code to reliably help business owners make decisions that enable effective compliance with tax legislation at the state, federal, and international levels. Failing to follow tax laws with precision can result in serious tax problems that active business managers can become personally liable for. Complying with tax laws prevents the possibility of your business incurring crippling tax debts that can lead to bankruptcy.
Prepare for and Avoid an Audit
The possibility of experiencing an audit is one of the worst fears of any business owner. Completing the paperwork associated with an audit can lead to tremendous losses for business owners who are not prepared to demonstrate the accuracy of their accounting. Steps can be taken to minimize the possibility of an audit, but the IRS can still subject a business to a random audit at any time. With professional assistance, your business can plan ahead for the possibility of an audit by accounting for transactions in ways that will meet IRS guidelines in the event of an audit.
Develop Strategies to Minimize Tax Liabilities
Taxes are one of the most significant expenses that business owners have to manage. A small business accountant can develop legal tax strategies to help minimize the tax burden your company is required to pay. Steps can be taken to minimize personal tax liabilities for shareholders to increase the net return on investment that your business can yield. Accountants can even help you to plan ahead for the future sale of your business or other major decisions that could lead to tax liabilities. The tax code is reformed every couple of years, and opportunities for saving substantial amounts of money on taxes almost always arise when these changes are implemented. An accountant is a critical partner for ensuring that you keep as much of your hard-earned money as possible.
Plan for the Future of Your Business
Accountants can help with much more than just tax planning for business owners seeking long-term results. You can use an accountant to develop reliable performance forecasts that will help you to avoid potential roadblocks while demonstrating the future potential for profitability to investors. Many accountants have experience analyzing market research, working with advanced data, and developing reliable business plans. Your accountant can be a valuable partner for seeing what the future of your business will look like depending on the decisions you make today. When you can make good decisions for the future of your business, you are more likely to realize a strong return on investment.
File Paperwork for Legal Compliance
Most businesses are subject to unique sets of laws that apply to certain industries or types of activities. There are so many laws on the books that many business owners struggle to recognize which laws they have to follow. Failure to comply with prevailing laws is one of the main reasons why businesses declare bankruptcy, and many of these businesses could have avoided failure by recognizing compliance requirements from the beginning. Your accountant can help your business to identify compliance requirements, then submit paperwork on your behalf to avoid legal liabilities. Remaining in compliance with the law ensures the sustainability of your business while minimizing your chances of incurring crippling losses.
Manage Payroll in a Professional Way
Payroll is a time-consuming responsibility that can bog down small business owners who try to complete this task on their own. Accountants are the best partners available for managing your payroll in a way that minimizes your chances of making a mistake while ensuring that your employees get the most money possible on the bottom line of their paychecks. Having your payroll completed by a competent professional ensures that you comply with both federal and state laws that can subject your business to enormous fines for making simple payroll errors.
A Partner to Double-Check Your Work
Accuracy is the most important factor in accounting, and busy business owners are often prone to making a mistake when in a rush. The responsibilities associated with running a business can force you to juggle multiple responsibilities at the same time, and this can lead to errors when managing your accounting on your own. Accountants can double-check your work to ensure that you are keeping accurate books on even your busiest days. You can also use an accountant’s expertise to make sure that you are accounting for line items in the generally accepted way. Even if you want to take an active role in managing your company’s books, an accountant can, thus, function as an effective partner to ensure accuracy while preventing costly mistakes.
When to Hire an Accountant for Your Small Business
Deciding whether to hire an accountant is an important decision that is easy to overlook. When you fail to hire a small business accountant, you incur the potential for serious liabilities that accountants can easily help you to avoid. Accountants also help to save money on taxes, and their work can even make your business more attractive to investors. If you own a business, finding the right accountant is an essential step for ensuring future profitability.
If you’re a small business owner, don’t wait until it’s too late. The right accountant will help you find ways to save money and alleviate some of the stress and time associated with doing things like taxes and payroll tasks. Don’t waste time and money trying to stumble through doing it on your own. Take action now to invest in an accountant for your small business.
Do you have an accountant for your small business? Share your experience with us!