5 Signs You Need A Professional CPA For Your Business

 

Financial matters often end up in the back seat for a lot of small businesses. Business owners remain so focused on acquiring new business and growing the company that they forget about accounting. Once they realize what they’ve overlooked, organizational finances go down the drain.

Don’t let the same thing happen to you. Hire a certified public accountant or CPA Century City for your business as soon as you spot these signs.

Accounting takes too long

The phrase “time is money” has become a cliché for all the right reasons. You’ll waste valuable time if you handle all the accounting aspects yourself. It also increases the chances of errors because you’re a business owner, not a tax professional. When you hire an expert, you’ll free up time that you can use to focus on your business. Also, you won’t have to worry about any errors.

Business growth

Accounting chores and paperwork grow with the business. If one doesn’t, the other won’t, either. Take a moment to think about the earliest days of your business. How many people worked with you then, and how many workers do you have now? How much did you earn then, and how much do you earn now? If your company has seen expansive growth, maybe it’s time to hire a professional CPA in Century City. Accounting professionals can actually contribute to business expansion.

Mixing up accounts

Mixing personal and business finances isn’t a good idea. CPAs always recommend having a designated business account that lets you keep personal finances and associated expenses away from the former. A designated business account makes bookkeeping easier. You’ll also be more protected legally. Besides, many business entities need separate accounts to operate.

The pangs of tax season

The tax season is stressful for everyone, particularly business owners. A CPA is more familiar with tax codes than any bookkeeper or accountant. These people must demonstrate their knowledge of tax codes to get licensed. Sometimes, even experienced CPAs need to participate in ongoing education to stay updated on constantly changing tax laws.

Passing audits

Audits expose the entire financial history of business owners. The presence of a CPA will ensure you’re in a better position during an audit. Their official license lets them represent you if you have to appear in front of the IRS. If there are too many errors, and if they raise red flags, you’ll be neck-deep in trouble.

Final words

These are just a few of the reasons your business needs a CPA from Century City. Of course, many other reasons exist, such as not understanding the complications of taxes and accounting or starting a new business from scratch. If you believe you need the services of a CPA, you shouldn’t hesitate to hire one.

Just make sure you don’t delegate the task to any CPA. Research accounting, bookkeeping, and CPA firms thoroughly before choosing a service provider.

How To Face A Small Business Tax Lien

 

Do you own a small business? Then you pay taxes, just like every other business owner. What if you fail to pay all your taxes to the local, state, or federal government? What happens then? You may have to deal with a tax lien filed against you. Any of these government entities can come up with this legal claim against your properties, including but not limited to equipment, financial accounts, or real estate. The lien lets the government seize one or more properties to settle your debt.

You will get a Notice & Demand for Payment of all unpaid taxes before a lien is filed. After that, you get ten days in which you have to pay the IRS or the local or state government in full. Failing to comply will result in a lien being filed. One way to avoid encountering such a situation in the first place is to leverage small business accounting services.

Effect on personal accounts

Whether the lien will affect your personal account depends on the type of business you run. For instance, limited liability companies and incorporated businesses have liens filed only against their organizational properties. Conversely, the lien can cross the borders of a business property and trespass the boundaries of a personal property if filed against a sole proprietor. This happens when the business property doesn’t satisfy the lien.

 

The outcome of a lien

Rest assured, you won’t start losing your assets immediately after filing a lien, but it’s a publicly disclosed notice that the tax authority can claim your property. It also means the tax body can initiate the seizure if you don’t pay on time.

Apart from your property being taken, the lien may put your company at risk of falling behind competitors. A tax lien also makes it almost impossible for business owners to avail of business loans as it affects your organizational credit rating. Simultaneously, it will hurt your credit rating, tarnish the company's reputation, and make it difficult to sell a business asset to pay the debt. That’s why the providers of small business accountingservices always insist clients on paying their taxes on time.

Termination of a tax lien

The safest option is to settle the tax debt as quickly as possible. Do it the moment the IRS or other government entities notify you. In doing so, you stop the lien from being filed. Then again, it may not be possible for you to pay in full. Contact the government agency to frame a new payment plan when that happens. This may also help you avoid the lien.

Withdrawal: In certain situations, the withdrawal rule can remove the IRS tax lien from your business if,

 

·      You create an installment payment plan that won’t take more than sixty months to pay in full.

·        You owe no more than $25,000.

·        You make three timely payments consecutively.

·        You weren’t a defaulter on a previous tax payment plan.

 

2. Subordination: While subordination doesn’t terminate the lien, it will allow other creditors to enter the scene and help you with your payments. Subordination lets you secure business loans or rearrange debt for more money flow

DiDescharge: The property discharging process removes the lien from one of your properties. As a result, you can sell it without the lien piggybacking it. This method lets you raise enough money to pay your business taxes. However, the rest of your organizational properties will remain under lien. You must qualify for the discharge process and need enough property to satisfy the amount owed.

 

Help is available

Yes, seek help from expert accountants offering small business accounting services whenever needed. Running a small business is difficult, but professional support can get you through the toughest times.