Business Success

Are You Doing What’s Right For Your Business?

Are you practicing sound fiscal management with your business? Most of us believe we are, but it is imperative that you maintain accurate and complete records for your business. Here are a few basic rules to guide you:
• Do not commingle funds! Ever. Period. Keep business money separate from personal money, open a business checking account and don’t mix the two.
• Include only business expenses, not personal expenses, in your business records.
• Keep ALL receipts for business purchases. If the business purpose is not clear from the receipt, include a brief explanation on the receipt. Don’t rely on your memory!
• Keep a record of all business income.
• Keep a record of all business expenses.
• If you have inventory…count it and track it!
• Create a company policy to make it easy for the company to consistently track and record reimbursable expenses. Failing to track reimbursable expenses can result in lost money as well as lost tax deductions.
• Track your mileage. Keep a record of where you went, the date, the mileage, and the purpose. In the event of an audit, detailed records will save you!

Now is the time to review your procedures and make the necessary changes. Don’t wait until it’s too late!

1099 Reporting Requirements

Did you properly issue IRS form 1099 Misc this year? If you have a trade or business and operate for the purpose of making a profit, then you fall under this category and should have issued 1099 Misc. Form 1099 should be issued to anyone your business pays $600 or more to in any tax year. This is any payments made to an individual or partnership. Generally speaking if you’ve made payments to a corporation, this is excluded. Payments to corporations are included only if they are for medical, health care, legal or fishing activities.

How do you determine whether or not the business you are dealing with is a corporation, sole proprietor, LLC, or partnership? When you begin doing business with a vendor have the vendor complete form W9, Request for Taxpayer Identification. These forms are for your records and are not submitted to the IRS. The W9 will help you determine how to treat their business. Form W9 is available to be downloaded from

These are a series of questions and answers provided by the IRS which may help provide you with more information on 1099 reporting:

· Question: Is an S-Corporation treated as a “corporation” when determining whether or not a 1099 should be issued?
IRS answer: Yes. The entity is a C-Corp that makes an election to be treated as an S-Corp. When completing Form W-9, Request for Taxpayer Identification Number and Certification, the S-Corp checks the box for a corporation.

· Question: Does a 1099 get issued to a limited liability company (LLC) reporting to the IRS as a partnership or to a single-member LLC that is incorporated with the state?

· IRS answer: It is the federal tax status that matters. Therefore, if the LLC is a partnership, then 1099s should be issued as required.

· Question: If a company has a “doing business as” (dba) name and they list themselves as a corporation, is it correct they do not need a 1099?

· IRS answer: It depends on the type of payment. Corporations are exempt recipients but a 1099-MISC may be required under certain circumstances. See the Form 1099-MISC instructions for further information.

· Question: If a sole proprietor has a dba name, and the payments are made out to the dba company, do we use the company EIN number or the name of the sole proprietor on line 1. I thought if we used their Social Security number on Form 1099-MISC, then their first name should be listed on line 1 of the name section. If we used their EIN number, then their dba name would be listed first and then their individual name listed next.

· IRS answer: The sole proprietor’s name goes on the first line, the dba goes on the second line; this is true whether the EIN or SSN is used.

Currently the regulations governing 1099 issuances are set to expand on January 1, 2012. As part of the new Healthcare Reform, a section was added that includes issuing 1099’s to corporations and will also include goods (like office supplies). In other words, every time your business spends $600 or more to a vendor, you will need to issue a 1099 at the end of the tax year. This has the potential to be a paperwork nightmare and burden for small business owners. The good news is that President Obama stated in his State of the Union speech on January 25, 2011, We can start right now by correcting a flaw in the [health care] legislation that has placed an unnecessary bookkeeping burden on small businesses”. We look for the new regulations to be removed or substantially reduced.

Take A Look In The Mirror!

How do you show up? A company’s attitude is a reflection of its leader. Let’s thitucson accountingnk about how a company in the worst of situations can change so dramatically when its leadership steps up and leads the way to success. Sometimes a new leader needs to take control when the current leader is stuck and frustrated. Do you show up to win or do you show up defeated? Do you show up positive and encouraging or do you show up negative and combative? If you’re blaming your employees’ lackluster performance, you’re blaming others for what you’ve created.
Do you understand the “culture” of your business? To understand business culture, take a look at the collective behavior of groups of people and organizations. To understand attitude, all you need to do is look at the faces and behaviors of those you work with. More importantly, don’t forget the face you see in the mirror. Engaging, inspiring and optimistic leaders lead engaging, inspiring and optimistic teams – and that’s the attitude your customers encounter. Grumpy leaders lead grumpy teams – and THAT’S the attitude your customers encounter. It’s that simple.
Simply put….as business owners YOU are the face, attitude, and culture of your business. If your team is failing take a look at yourself. Do you have a clear mission and direction for your business? With no clear direction from you, your team will fail.

Small Business Can Succeed!

Small businesses are the backbone of the American economy. Typically a small business is defined as having fewer than 200 employees. Of all US businesses, it is estimated that more than 99% are small business. Nationally, small businesses:
 Create 75% of all new jobs
 Employ 52% of the business workforce
 Produce 51% of our nations private sector gross domestic product (GDP)
 Generate 96% of all the US exported goods and services
 Include 7 million women and minority-owned firms
 Provide about 67% of “first job” opportunities
 Produce more than half of the innovations in products
As you can see, small businesses do succeed. Do you have what it takes?

Here is a great tip….accounting functions, as mundane as they sometimes seem, are actually your biggest secret weapon for business management, growth, and success! Only with accurate and consistent measurement of your company’s financials can we as business owners effectively manage and expand our business. Verace Accounting is here to help you succeed. Contact us to see how we can help you grow!

The Biggest Mistake Small Biz Owners Make…

tucson accountingAs small business owners bookkeeping/accounting tasks are often tasks we take on ourselves, shove to the backburner and hope we can catch up on them later.  These tasks can be time consuming, feel unrewarding, and the mistakes can be costly.

One recurring mistake made by business owners is not properly valuing their own time.  How you value your time is one of the key factors to succeeding in your business.  Now is the time to make the conscious decision to leave these stressful and time consuming tasks to a professional accountant.

A professional accountant will know what to record, how to record it, and also accounting changes that affect your business on an ongoing basis.  Not only will this safe you time, but it also frees up your time so that you can continue to focus on growing your business and taking it to the next level.

Now is the time to take a look at your business and make the simple strategical decision to turn over your accounting tasks to a professional.  Turn these dreaded tasks into your secret weapon for business management, success, and growth.

Verace Accounting is your solution to overwhelming accounting tasks.  Call us today and discover how we can support you in growing your business with ease.

Verace Accounting…

10950 N. La Canada #6204
Tucson, AZ 85737

520 668-9338