Business Accountant Austin TX

10 Ways to Avoid Accounting Horror This Halloween

To keep the financial ghouls and gremlins out of your books this fiscal year, here’s your 2024 guide to preventing accounting nightmares:

Horror Prevention Checklist:

1️⃣ Keep Software from Turning Zombie – Update your accounting software regularly to avoid it turning into a glitchy, rogue monster.
2️⃣ Ghoul-Proof Your Internal Controls – Solid checks and balances are like garlic for financial vampires, keeping any mischief out of your books.
3️⃣ Backup Before the Apocalypse – Always back up your financial data. You never know when tech troubles (or financial zombies) will strike.
4️⃣ Witch-Watch Your Cash Flow – Keep stirring that financial cauldron, and watch for any odd bubbles that might spell trouble.
5️⃣ Audits: The Ghostbusters of Accounting – Regular audits will help you exorcise unwanted financial surprises.
6️⃣ Don’t Let Taxes Haunt You – Stay up to date on tax laws so that IRS specter doesn’t pop up unexpectedly.
7️⃣ Employee Vetting: No Vampires Allowed – Make sure your employees are only sucking up knowledge, not company funds.
8️⃣ Double, Double, Two-Factor Trouble – Secure your financial accounts with two-factor authentication for extra protection.
9️⃣ Guard Your Financial Treasures – Store important documents in a password-protected vault, preferably guarded by a digital dragon.
1️⃣0️⃣ Summon Your Financial Wizards – Consult with accounting experts regularly to keep dark forces (and tax surprises) at bay.

With this handy checklist, your 2024 financial books will be free from any scary surprises—no ghouls, goblins, or gremlins in sight!

Ready to ward off accounting nightmares?

Our team of financial wizards is here to help you make 2024 your most profitable (and least spooky) year yet. Reach out today, and let’s ensure your business is as safe as a password-protected vault!

Last Minute Tax Filing Tips 2024

Haven’t filed your taxes yet? It’s okay, you’re not alone. Believe it or not, many people don’t file in early February when tax season starts. In fact, about one-third of taxpayers in the U.S. wait until the last two weeks before the April deadline to file!

But waiting too long can cause headaches. Rushing to meet the deadline increases the risk of errors, which could cost you more in the long run.

With the deadline looming, now is the perfect time to get organized—whether you file yourself or seek professional help. Ignoring your tax prep won’t make it disappear (unfortunately), and filing late will only add interest charges, which could end up costing you hundreds.

Start by Getting Your Tax Paperwork Organized

We get it—paperwork isn’t fun. Tax forms tend to mix with junk mail, old bills, and receipts from last year. But even if the thought makes you groan, organizing your tax documents is the first essential step for smooth tax filing. You’ll feel a weight lift once it’s done, trust us.

Here’s what you’ll likely need for tax filing:

📌 W-2 forms
📌 1099 forms
📌 Mortgage interest statements
📌 Receipts for deductions, like charitable donations or medical expenses
📌 Health Savings Account (HSA) statements

💡 Pro Tip Create a dedicated folder and collect your tax docs throughout the year. That way, when the next tax season rolls around, you’ll be ready—and you might even file early!

❓ Should You Take the Standard Deduction or Itemize?

Time is ticking, so it’s tempting to take the standard deduction just to get it over with. But before you rush, check if your expenses might exceed the standard deduction. Even though the Tax Cuts and Jobs Act doubled the standard deduction, itemizing could still save you money, especially for state taxes.

Need help figuring out if itemizing is the right move? We’re here to assist you, but don’t wait too long—accountants get busy fast as the deadline approaches.

❓What Happens If You Miss the April 18th Deadline?

If the April 18th filing deadline passes by and you still have not filed, there will definitely be repercussions from your decision, however, the severity depends on if you owe the government or not.

💡 Late-Payment Penalties

Even if you can’t pay your full tax bill, file on time to avoid the steeper “failure-to-file” penalty. It’s the smart, cheaper choice.

💡The Earlier You File, The Less You Pay

If you can’t pay the full amount, contact us ASAP to get your filing done. The sooner you file, the less you’ll end up paying in penalties. Remember, it’s not just about paying—it’s about filing first to minimize your financial hit.

💡Consider Filing for an Extension

If you’re still missing key documents, you can request a six-month extension by filing IRS Form 4868. But don’t forget: an extension only gives you more time to file, not more time to pay.

💡Pay What You Can Now

If covering the entire tax bill is out of reach, pay what you can when you file the extension. Then, work on settling the rest before the IRS comes knocking. If needed, you can set up a payment plan online.

Get Your Taxes Done Right

Feeling overwhelmed by tax filing? We’re here to help! Whether you need assistance with tax prep or an extension, contact us today. We’ll get your taxes squared away in no time, so you can stop stressing and avoid those costly penalties.

Ready to avoid those last-minute tax filing stress headaches? Get in touch with us today. Let’s get your taxes done right—and on time!

8 Smart Year-End Tax Planning Tips

Year-end is just around the corner, but you still have time to make some smart tax-saving moves before the clock runs out. These Power 8 strategies can help you lock in savings and set yourself up for a successful tax season.

1️⃣ Check Your Paycheck Withholding

Hey, check your paycheck withholding. Too much? Hello, refund! Too little? Hello, surprise bill from Uncle Sam! Aim for a break-even to make your money work harder, not the government.

2️⃣ Defer Your Income

Got a bonus coming? See if you can push it to next year and lower your tax bill. Self-employed and filing accrual basis? Consider delaying those invoices to your customers.

3️⃣ Adjust Retirement Account Contributions

Boost those pre-tax retirement contributions and save on taxes. Or look at maxing out your ROTH contributions by year-end. But remember, this money is for your golden years, so only boost if you have extra cash lying around.

4️⃣ RMDs for the 73+ Club

If you’re 73 or older, don’t forget to make your RMD withdraw from your retirement accounts by Dec 31st! Miss it, and Uncle Sam hits you with a hefty penalty. No one wants that.

5️⃣ Use Your Gift Tax Exclusion

Feeling generous? Use your $17,000 exclusion to give money to each person without Uncle Sam dipping into it. Stay under the radar of the IRS’s gift grab.

6️⃣ Maximize Tax Deductions and Credits

Pay property taxes and January’s mortgage early for deductions. Donating big? Itemize for tax breaks. Going electric? Enjoy those EV credits. And finish those eco-friendly home upgrades!

7️⃣ Consider a Roth Conversion

Switch to a Roth for tax-free growth and withdrawals. It’s a savvy move but chat with a pro first. Keep those dollars away from the taxman!

8️⃣ Consult a Tax Professional

End-of-year tax planning? Get a tax pro on your side, like us! Make smart moves, cut your tax bill, and stride into tax season like a boss.

Let’s turn these tax tips into real savings!

Call us today, and together, we’ll craft a personalized tax plan that ensures your 2024 year-end tax strategy is rock solid. Finish the year strong and stride into tax season with confidence!

6 Year-End Tax Planning Strategies to Consider Now

Have you kicked off your year-end tax planning yet?

As we are approaching the final quarter, it’s the perfect time for strategic tax planning to reduce your tax bill. If you’re a business owner, tax planning isn’t a one-and-done deal—it’s an ongoing process.

Tax Planning Tips

Here are six essential year-end tax planning strategies for 2024 that you should consider:

1️⃣ Review Your Business Structure
(see What’s the best business formation setup in this booklet). As your business grows, your structure (entity) may change.
2️⃣ Maximize Your Retirement Plan: Save on taxes by contributing to a retirement plan. Whether it’s a SERP IRA, Solo 401(k), or a combo of a 401(k) with a defined-benefit pension plan, these are effective tools for slashing your tax bill.
3️⃣ Utilize the Home Office Deduction: This valuable tax break can save hundreds, or even thousands, of dollars in taxes each year.
4️⃣ Ditch the Shoebox Accounting: Track income and expenses throughout the year using a cloud-based tool your accountant can access.
5️⃣ Consider First-Year Bonus Depreciation
80% bonus depreciationon new property acquired and placed in service during 2021. If you’re having a big income year, consider moving up big purchases before year-end (see Should I buy equipment for year-end in this booklet).
6️⃣ Be Proactive with Income and Deductions: If you expect to be in the same or lower tax bracket next year, deferring some income to 2025 could be beneficial. Conversely, if you expect a higher tax bracket, accelerating income into 2024 or delaying deductions until 2025 might make sense.

💡 More Tips

Don’t miss out on additional year-end tax planning strategies. Download our comprehensive 2024 Year-End Tax Planning Guide for business owners and ensure you’re making the most of every opportunity to reduce your tax liability.

Ready to put these strategies into action?

Schedule a consultation with us today, and let’s tailor a tax planning strategy that works for your unique business needs—because smart planning now means fewer headaches later.

Does it make sense to buy this equipment before year-end?

If you’re eyeing a significant deduction (and who isn’t?), the Section 179 IRS tax code allows businesses to deduct up to $1,080,000 on qualifying capital equipment. However, there’s a cap—businesses can’t spend more than $2,700,000 on such equipment during the tax year to be eligible for this deduction.

To qualify, the equipment must be purchased and in use by 11:59 p.m., December 31, 2024. With supply chain challenges still a concern, it’s wise to make your business purchases sooner rather than later to avoid any last-minute stress.

❓ How much can I save?

Section 179.org offers a simple-to-use calculator to help you estimate your tax savings. Enter the price of your equipment or software to see how much you can save.

❓What qualifies?

According to the Section 179 FAQs, “Most tangible equipment that businesses purchase or lease will qualify for the deduction.”

Common equipment includes machinery, computers, computer off-the-shelf software, office furniture and equipment, qualifying vehicles, or other tangible goods. Qualifying business vehicles with a gross vehicle weight in excess of 6,000 pounds are also included. Property attached to your building that is not a structural component of the building (i.e., a printing press, large manufacturing tools, and equipment) is included. Also, certain improvements to existing non-residential buildings, such as fire suppression, alarms and security systems, HVAC, and roofing are included.

Now is the time to act on this valuable tax-saving opportunity. Tax regulations can change, sometimes even mid-year, so it’s crucial to take advantage of this break while it’s available. Contact us to ensure you’re maximizing your equipment maintenance and purchase deductions.

Want more year-end tax tips?

Download our latest Year-End Tax Planning Guide today to stay ahead of the game. Let’s chat about how your business purchases and equipment maintenance can give you the deductions you deserve.

Reach out today—we’re here to help you navigate the year-end rush with ease.

How to Pay Yourself as a Business Owner

As a business owner, how much should I pay myself on a W2 before year end? This is a common question we get from small business owners. How you pay yourself as a business owner largely depends on your business structure, where you are in your business journey, and a few other key factors.

Here are the two most effective ways to pay yourself as a business owner:

1️⃣ Salary
You pay yourself a regular salary, withholding taxes from your paycheck. This is legally required for businesses that are structured as S- or C-corporations or a limited liability company (LLC) taxed as a corporation. The IRS has a “reasonable” compensation requirement, which means your salary should be comparable with what someone else doing the same job in your industry would be paid.

2️⃣ Owner’s Draw
Outside of running W2 payroll, if you are a sole proprietor, S-Corp, or Partnership, all remaining money in your business account can be distributed to the owners, equally per their ownership percentage, at any time. You are taxed on all of your profits annually, so all the remaining cash in your business account is yours to choose what you do with. Just remember you will owe federal tax on your profits when filing your personal 1040 taxes.

So, How Do You Decide?

Your specific business structure dictates whether a salary, an owner’s draw, or a combination of both is the right move for you.

❓ How Much Should You Pay Yourself?
This is one of the most common questions we get. Most people just guess an amount, which usually causes them to over-pay unnecessary payroll taxes, which is a waste of money.

💡 Start with Your Business’ Net Profit

Your reasonable salary should be based on your business’s net profit, which is your business revenue minus all business expenses, and/or using our third-party software to answer a number of questions to determine what your maximum salary amount should be.

💡Avoid Risking an IRS Audit

What you want to avoid is risking an IRS audit because you did not pay yourself a high enough W2 salary, or have any justification for how you came up with your W2 salary amount.

Steer Clear of These W2 Pitfalls

Here are some common mistakes to avoid when setting up your W2 salary:

📌 Mixing personal and business finances
📌 Not budgeting for taxes
📌 Underpaying yourself, risking an IRS audit due to not meeting the reasonable salary rule for S-Corporations.

Your compensation should be part of your overall business plan. Financial projections should include your salary or owner’s draw to give you a clear picture of what your business needs to thrive. If you’re unsure which method is best for you, we’re here to help.

Get Personalized Tax Advice

Looking for more tailored tips on paying yourself as a business owner? We’re here to help you navigate your business structure and compensation strategy with ease. Give us a call today!