While not all accountants are created equal, the good ones can actually help you with more than you think as it pertains to your business.
In fact, my accountant is practically my business consultant too. He’s also come to the rescue whenever one of my clients makes a mistake on a tax form.
Here are just some of the things a good accountant may be able to help you with if you just ask. Given that it’s tax season, you might want to keep this list handy.
Getting you corrected tax info.
I recently had a client send me the wrong tax info. They made a mistake in giving me a 1099 form when they didn’t have to because they used a payment settlement service like PayPal.
After trying to handle the situation on my own and not really getting anywhere, I got my accountant on it. He sent their accountant an email detailing why a 1099 form wasn’t needed and within three minutes I had my corrected tax form.
(Note: This goes both ways. A good accountant knows not to send your contractors 1099 forms if you paid them using a payment settlement service.)
Helping you allocate funds appropriately.
Since my accountant knows the numbers in my business (quite possibly even better than I do) I sometimes ask him for his guidance when I’m about to make a big investment.
For example, I know I need to invest more money in hiring help so I can delegate tasks that aren’t getting me paid, but I wasn’t sure where it would make the most financial sense to start outsourcing.
So what did I do? I sent my accountant a text and asked him to help me figure it out. He was more than happy to oblige and a good accountant should do the same.
Tax planning throughout the year.
A good accountant shouldn’t just be around during tax season. In fact, they can help you tax plan throughout the year. This means maximizing investments and helping you calculate estimated taxes.
In addition, a good accountant can help you avoid underpaying on your estimated taxes and then getting slammed with a massive tax bill at the end of the year. Or, they can keep you from overpaying.
My accountant was able to save me $2500 this past quarter because he noticed I would have been overpaying on my taxes. That’s $2500 that can now go into savings or be reinvested back into my business.
There’s no way I can do any of the above on my own. And, quite frankly, TurboTax isn’t really going to cut it for my business.
Some accountants offer bookkeeping as a part of their services. You can pay them on retainer and then they handle the books for you on whatever accounting software you’re using. This can save you time so you can earn more money.
The way my accountant recently explained it was like this. Let’s say an accountant is costing you $600 a month but he’s saving you two hours in bookkeeping. Let’s also say you charge $400 per article and can get one done in an hour. That’s a total of $800 in two hours.
If this is the case, you still come out $200 ahead and you don’t need to worry about the headaches that come with reconciling bank statements.
A good accountant is a powerful ally to have on your financial team. Make sure to utilize all the services they offer so that you can keep growing your business.