As we approach the end of 2013, it is time to start getting your year-end financial information in order.
The advice that I always give is to keep business and personal expenses separate. Establishing a business credit card and paying it off in a timely manner is a solid business practice and helps improve credit ratings if you need financing. Additionally, this practice makes for tidier accounting at the end of the year.
If you run a retail business, the next three weeks will be the busiest of the year. However, with both Christmas and New Year's Day falling on Wednesdays, there will likely be down time during the days in between and immediately after. This will be an ideal opportunity to look at your books and update them if you are a bit behind. Entrepreneurs who have not been keeping track of business expenses throughout the year, should begin recording them now so that the task is not overwhelming in the New Year.
For those small business owners who use an accountant to do all their bookkeeping, it's a wise idea to set up a meeting before 2013 ends or in early January. Many small business owners make the mistake of only meeting with their accountants close to the April 15th deadline when everyone is trying to rush. Take advantage of downtime at the end of the year or in January before tax season really gets into high gear. Your CPA will have more time to work with you and won't be as stressed as he will be in March or April.
If you are operating as a sole proprietor, establishing an LLC or a C-corporation helps formally separate business and personal assets and offers certain tax benefits. Sometimes the tax implications can be significant. From a marketing perspective, it makes your company look more professional if it is established as an LLC of C-Corp business format. Use the slow time at the end of December to investigate this and perhaps even start the incorporation process.
The average small business owner is not up-to-date on tax codes. While many are able to do their own filings on their own or with the help of computer software, hiring an experienced tax accountant may be the best option for saving money on your taxes.
For instance, a number of deductions expire on December 31st. With this in mind, Biz2Credit and Small Business Trends will co-host a webinar, Year-End Small Business Accounting Tips, featuring money-saving tax advice from experts in accounting, finance and business incorporation. Hosted by small-business expert Anita Campbell, the webinar takes place on Tuesday, December 10, 2013 at 3:00 PM (EST). Registration is free at http://www.biz2credit.com/webinars/year-end-small-business-accounting-tips. Topics will also include best sources of capital in 2014, as well as growth strategies for CPAs and their small business clients.
Rohit Arora is co-founder and CEO of Biz2Credit, an online resource that connects 1.6 million small business owners with 1,200+ lenders, credit rating agencies and service providers such as CPAs and attorneys via its Internet platform. Since 2007, Biz2Credit has secured more than $1 billion in funding for small businesses across the U.S.