Business Accountant Austin TX

How Can Accounting Firms Assist Startups & Small Business in 2024?

Accounting for small businesses can feel overwhelming, but with the right help, it doesn’t have to be. A certified public accounting (CPA) team can play a critical role in helping startups and small businesses through the dreaded tax season and beyond, making day-to-day operations smoother. If you’re a small business owner, take the time to understand how a CPA team can benefit a company like yours.

💡 Accounting for Small Businesses: The Benefits of Using a CPA Accounting Team

Accounting Can Be Time-consuming
Some of the most time-consuming tasks for a business owner can be your accounting responsibilities, especially if you don’t have experience in the field. If you aren’t comfortable handling the aspects of your company’s accounting, consider outsourcing to a CPA team. They can provide expert services in small business bookkeeping, tax planning, data management, and more. They can even take on chief financial officer (CFO) duties, which is a position in the company that you may not currently have filled. Instead of going it alone, why not let a team of professionals lighten your load?

Keeping Up-to-date on Accounting Trends
An integrated CPA team will keep your company up to date on new accounting trends and policies and will take the time to find solutions and tools to make your financials easy to manage.

Establish a Proactive Tax Strategy
You would be smart to establish tax strategies early—something that a CPA team can help you with—in order to get the most out of your profits. Although hiring a CPA team will initially cost more than doing it yourself or keeping an in-house accountant, you’re going to benefit in the long run in terms of money saved thanks to their expert advice.

Let’s Talk About Tax Deductions

What are Tax Deductions?
Tax deductions are expenses that you can claim against your tax payments in order to reduce the amount you pay.

As a small business, there are certain tax deductions that you might benefit from even if you don’t know it yet. Here are a few examples:

📌 Work-Related Travel Expenses: Any travel you might do for work—whether it’s a train ticket, gas for your car, or a hotel stay—could be deductible. The trip itself must be necessary for business, take you away from your home, and be longer than a working day.
📌 Home Office Expenses: If your small business operates from a home office, expenses like office supplies, equipment, and even a portion of your rent or mortgage may be deductible. You can even claim $5 per square foot of space used by your office.

A CPA team can walk you through all the deductions you might be able to claim and ensure that you’re saving as much money as possible.

💡 Getting Audited

Audits Happen
Audits happen regularly, and it’s mandatory to comply with the IRS when they decide to audit you. The main reasons for an audit include ensuring your financial statements as a business are accurate and free from errors that might otherwise point to suspicious activity.

The Pain of Audit Compliance for Small Businesses
An audit can be a real pain, requiring you to pull information from all your accounts and source any information that auditors might request. That means you’re at their beck and call, which can be a serious disadvantage when trying to handle accounting for small businesses.

Minimizing Your Risk of Being Audited
Audits can be avoided by following the advice of a CPA team. It’s less likely that you’ll be audited if your financials are handled by a professional. Although it’s not guaranteed that you won’t be audited if you hire a CPA team, they can take preventative measures to make the auditing process as smooth as possible.

💡Strategizing & Planning With A CPA Team

A CPA Team Will Help You Understand the Financial Effects of Business Decisions

Whenever you make a business decision, there will always be financial implications—good or bad. A CPA team will be able to help guide you to make the right choices and avoid the wrong ones. They can help you understand what your money is best used for and how you can increase your profits.

For example, if you want to hire a new staff member or invest in training, your CPA team can advise you on what’s best for your budget.

With a CPA team, you can easily look at the bigger picture and create a detailed strategy for the future of your company. They can help you explore the opportunities you have as a small business and how to leverage your resources to grow. Together with your CPA team, you can make the right decisions to ensure your business is on a positive financial route.

Take Advantage of Your CPA Team

When it comes to your accounts, take advantage of what an integrated CPA team can offer. Weigh the pros and cons of outsourcing your accounting duties, and consider how a whole team can make accounting for small businesses a breeze.

Feel like you’re juggling too many numbers?

? Let’s make it easier. Contact us at Insogna CPA, and we’ll show you how we can take the weight off your shoulders. Whether it’s tax season or day-to-day operations, we’re here to help your startup or small business thrive in 2024 and beyond. Let’s chat and get your financials in tip-top shape!Top of Form

Why Traditional Accounting Still Matters in 2024: Beyond QuickBooks and TurboTax

Intuit promotes their products like QuickBooks and TurboTax as quick fixes for your tax needs. And sure, if you’re a seasoned pro, handling your own taxes might work out just fine.

But for business owners, this DIY approach often falls short compared to the deeper insights traditional accounting can offer.

Rise of Intuit

With the rise of Intuit’s user-friendly software, the invaluable role of a licensed CPA has been overshadowed.

Yet, the real value CPAs offer—like legally lowering taxes and equipping businesses with the insights they need to make pivotal financial decisions—can’t be replicated by software alone.

Bridging the Gap

A return to traditional accounting isn’t just nostalgic; it’s a return to real, value-driven expertise that a licensed CPA brings to your business.

At Insogna CPA, we bridge the gap between cutting-edge technology and the irreplaceable human expertise that business owners need. While Intuit’s tools are great for some tasks, they can’t replace the strategic advice and personalized service that we provide. We’re here to help you maximize deductions, build your business, and grow your personal wealth.

Ready to take your accounting beyond the basics?

Contact us today to discover how our expert team can bring a personal, human touch to your business’s accounting and taxes. Because in 2024, traditional accounting is anything but outdated—it’s essential.

Tax Prep vs. Tax Planning

If you run a small business or are self-employed and pay taxes annually, you might be missing out on savings due to inefficient tax planning. Paying your tax bill all at once at the end of the year might seem straightforward, but it can lead to poor cash flow and those dreaded IRS penalties.

In this article, we’ll explore the difference between proactive tax planning with a Certified Public Accountant (CPA) and the more reactive process of tax preparation. If you’re not sure where to start, a CPA can help you get organized and ensure you’re not overpaying—or underpaying—your taxes.

❓ What Is Tax Preparation?

Tax preparation is the annual ritual of getting your tax return ready. It involves gathering all your financial documents and organizing them according to the latest IRS guidelines. This once-a-year task is purely transactional and doesn’t offer ongoing advice that could help lower your taxes, especially when compared to the continuous nature of tax planning.

Depending on your industry and experience, tax preparation can be time-consuming and stressful. It’s best to start early, but even then, tax prep often doesn’t give you the flexibility to maximize your savings. If the complexities of tax prep leave you frustrated and overwhelmed, you’re not alone.

❓What Is Tax Planning?

Ever find yourself filing taxes in the spring and hearing, “You should’ve called me last year to save some money”? That’s where tax planning comes in.

For those owning a pass-thru business, your tax bill is tied to your personal IRS1040 return, based on your business profits. Many businesses wait until taxes are due and pay in a lump sum, but this approach is far from efficient. It can even lead to penalties if you owe a significant amount.

Tax planning is a proactive approach, where you estimate your tax liability throughout the year by tracking income and expenses. This ongoing process allows for regular adjustments and recommendations that can reduce your taxable income before the year ends. Regular consultations with your CPA throughout the year are essential for staying ahead of the game. Efficient tax planning can boost your cash flow and keep more money in your pocket.

For instance, if a company waits until the end of the year to prepare taxes, it might have overspent throughout the year. In contrast, ongoing tax planning allows you to manage taxable income wisely, pay only what’s required, and maintain better cash flow for wealth planning.

❓ Why Is Tax Planning Beneficial?

Tax planning is crucial for any business. As mentioned earlier, ongoing planning alleviates cash flow stress when taxes are due in April and maximizes tax efficiency by legally lowering your taxable income throughout the year.

Moreover, tax planning gives you control over when and how you pay taxes, potentially reducing the overall tax burden. When done correctly, tax planning is the most reliable way to manage your business finances.

❓ What Can a CPA Firm Do?

Certified Public Accountants (CPAs) are experts in all things tax-related. They stay up-to-date with the latest IRS regulations and work closely with businesses like yours to offer ongoing tax planning strategies. With a CPA by your side, you can ensure you’re only paying the taxes you owe—and not a penny more—while also exploring tax deferral strategies to save even more.

CPAs are well-versed in federal tax laws and can offer guidance that helps you avoid missed deductions or costly penalties. By outsourcing your tax planning to professionals, you can focus on your day-to-day operations while knowing your finances are in good hands.

Tax planning isn’t just about meeting your tax obligations; it’s about creating a financial strategy that supports your business goals. With a qualified CPA team, tax planning can lead to significant savings and even help grow your wealth.

Why give the IRS more than you have to?

At Insogna CPA, we believe tax planning is a year-round strategy. Don’t wait until the last minute—reach out to us today and start saving with a personalized tax strategy that works for your business in 2024 and beyond.

How to Create a Business Budget for Your Startup

As you piece together your budget, it’s not just about the numbers—it’s a chance to gain a deeper understanding of how your startup operates. Once you can better identify how much money you have on hand and where it’s going, you start to better understand things like:

✅ The actual money you’re spending on labor and other materials necessary for your products and services.
✅ Your overall costs of operations.
✅ The level of revenue you’ll need to generate to support your business moving forward. A realistic idea of how much money you can expect to make in terms of profit, and when.

So, as you work to come up with a budget that is more specific to your growing startup, you also begin to better understand how that startup works. At that point, you’re not just in a position to make accurate, informed decisions about things like hiring or materials spending ‒ you can also go back and reconfigure your budget to account for any trends or patterns that you’ve discovered. This cyclical process is also a great way to make sure that you always have the cash necessary to take advantage of opportunities as quickly as possible, even ones that you didn’t necessarily expect.

The “Day One” Budget

Let’s say you’re building a budget for a startup that hasn’t launched yet. Your focus here is simple: make “Day One” happen. While every business is unique, a few critical factors should be top of mind to ensure a smooth opening:

💡 Facilities Costs

Where will your business call home? Whether it’s a rented storefront, commercial office space, or a warehouse, consider all expenses—from security deposits to necessary renovations and signage.

💡Fixed Assets

These “capital expenditures” are the tools your team needs to get the job done. Think work vehicles (if applicable), office furniture, and essential equipment like computers—after all, your team needs a solid workspace.

💡Materials and Supplies

This includes everything from basic office supplies to marketing materials. Stocking up on these essentials will help your business hit the ground running.

💡Miscellaneous

Finally, there are those other expenses that don’t fit neatly into the above categories. Legal fees, financial consultations, licenses, permits—all these add up and are crucial to your startup’s foundation.

Remember, these are just the startup costs to get your doors open, not the long-term operating expenses.

🚩 Get It Right from the Start

Feeling stuck or overwhelmed?

We’re here to assist. We can help craft a budget that not only supports your startup today but also positions you for growth in the future. Let’s ensure you’re ready for both the present challenges and the exciting opportunities that 2024 will bring.

Take the first step towards securing your startup’s future—schedule a consultation with us today!

11 Business Tax Deductions in 2024

When tax season rolls around, every business owner starts looking for ways to minimize their tax bill and keep more of their hard-earned money. Knowing which business tax deductions you can claim is key to ensuring you’re not overpaying. While office supplies are a given, there are several other deductions that might surprise you and significantly reduce your taxable income.

Whether you’re a seasoned entrepreneur or just starting out, these deductions can make a real difference in your bottom line. In this post, we’ll break down 11 essential business tax deductions you should consider claiming on your taxes this year. Taking advantage of these deductions can help you lower your tax liability and reinvest those savings back into your business.

Pro Tip: Don’t forget to check out our 2024 Business Tax Prep Checklist for a smooth tax season.

💡 Here's other things you might be able to claim on your taxes

✅ Retirement Plan Contributions
✅ Health Insurance Premiums
✅ Marketing Your Business
✅ Business-Related Insurance Premiums
✅ Legal and Professional Services
✅ Home Office Deductions
✅ Auto Expenses Related to Your Business
✅ Office Supplies
✅ Licensing and Taxes
✅ Your Cell Phone
✅ Self-Employment Tax

Need Help?

Taxes can be tricky, but they don’t have to be. Let’s talk about your specific tax needs and find every business tax deduction you’re eligible for. Schedule a free consultation today, and let’s make tax season as stress-free as possible.

Hobby or Business? Understanding the Difference According to IRS Rules

When you’re passionate about something, it’s easy to lose track of time—and money—pursuing it. But if that passion starts bringing in cash, it’s time to ask yourself: Is this a hobby, or have I inadvertently become a business owner? The IRS takes this distinction seriously, and so should you, especially if you want to stay on the right side of tax laws and avoid any surprises come tax season.

💡 The IRS Wants to Know: Hobby or Business?

The IRS has clear guidelines to help you determine whether your side gig is a hobby or a business. If you’re treating it like a business, they expect you to show it. This includes maintaining accurate records, dedicating time and effort to make it profitable, and relying on the income it generates. On the other hand, if your activity is more about personal enjoyment and not about making money, it might be classified as a hobby.

📌 Here are some key factors the IRS considers:

✅ Businesslike Manner: Are you keeping track of your income and expenses, and do you have a plan to make a profit?
✅ Effort and Time: Are you investing significant time and effort into this activity, indicating that your goal is to make it profitable?
✅ Dependence on Income: Do you rely on the income from this activity to support your lifestyle?
✅ Personal Motives: Are you doing this because you enjoy it, or because you’re aiming to turn a profit?
✅ Other Income Sources: Is this activity funded by income from other sources?
✅ Profit History: Have you made a profit from similar activities in the past, and do you expect to in the future?
✅ Adjustments for Profitability: Are you changing how you operate to try to make more money?
✅ Expertise: Do you have the knowledge to run this activity successfully as a business?
✅ Profit Consistency: Does the activity make a profit in some years? Can you reasonably expect future profits from the assets involved?

No single factor will determine your classification; the IRS looks at the entire picture.

❓ Why This Matters for Your Taxes

If your activity is classified as a business, you can deduct business expenses, which can reduce your taxable income. But if it’s a hobby, the rules are stricter, and deductions are limited. Misclassifying your activity could lead to issues with the IRS, including penalties.

🚩 Setting Yourself Up for Success

Whether you’re just starting out or have been at it for a while, proper planning is key to success. Every business is unique, so your budgeting should be too. Start by clearly defining your long-term goals—where do you see yourself a year or five years from now? Once you have that vision, you can create a budget that aligns with your goals, ensuring you spend money wisely to support your business growth.

Unsure whether your passion is a hobby or a business?

2024 could be the year your passion project takes off. But if it does, be ready for the IRS to take notice. Understanding whether you’re running a business or indulging in a hobby can save you a lot of headaches—and potentially a lot of money—down the line.

If you’re unsure whether your passion is a hobby or a business, or if you need help getting your finances in order, let’s chat. Our team of tax experts is here to help you navigate the IRS’s rules and set you up for success in 2024 and beyond. Don’t leave your tax situation to chance—reach out today and turn your passion into a profitable venture with confidence.