Q. What triggers an audit?
- An audit can be triggered by a multitude of factors. By working with a certified public accountant you can significantly reduce the chances of your tax return being audited and ensure that your financial statements are complete and accurate.
Q. What is the difference between and Independent contractor and employee?
An independent contractor vs an employee is determined by several factors including
- Behavioral control of the employee
- Financial control of the employee (expense reimbursement and tools/supplies)
- Type of relationship with employee (non-compete agreement, vacation pay)
Q. Do I have to file 1099’s
A. If you have made payments to an independent contractor who is not incorporated or an attorney in excess of $600 you must file form 1099. Additional parameters apply, please call the office to set up an appointment regarding any questions.
Q. What is a W-9?
A. A form W-9 is a taxpayer identification number and certification request. Employer’s will ask for this to ensure that tax identification is correct when sending forms (such as 1099s) to the IRS.
Q. What is a W-4?
A. A form W-4 is provided to your employer so that the correct amount of federal income tax is withheld from your pay.
Q. What is a W-2?
A. A form W-2 is a wage and tax statement which shows a summarized view of your total income and taxes for the year. A copy of this will be furnished to the IRS to ensure the correct amount of income is reported on your tax returns.
Q. Do you work with non-profit organizations?
A. Yes, we work with a multitude of non-profit organization and are proud to offer a courtesy discount for these organizations.
Q. What accounting software platforms do you work with/prefer?
A. We work with several accounting software platforms including: Ultra Tax, Quickbooks, Peachtree and Sage fixed assets.
Q. Are you Quickbooks certified?
A. Yes, we are Quickbooks certified advisors and have many years of experience working with this software.
Q. When are tax returns due?
A. Depending on the type of business entity (LLC, S-Corp, Partnership) the due dates of the returns vary. Please contact the office if you have questions.
Q. How long should I keep my tax records?
A. Please refer to our document library re: Individual Record Retention
Q. What if I owe taxes and can’t pay the full amount?
A. By working with us we can help you better estimate your taxable income to avoid any “surprises” when filing your personal and/or business return. If you owe money to the IRS which you are unable to pay there are several options available including a payment plan. *Some conditions apply.
Q. Can I defer taxable income to a later year?
A. There are various income planning strategies which can be utilized to reduce your tax burden. Please contact the office to set up a meeting with one of our consultants.
Q. Should I consult a CPA if I am starting a new business?
A. Yes, by working with a CPA you can start your business off on a solid financial ground which is pivotal to long-term success.
Q. Which type of business entity are best for tax purposes?
A. Every client has a unique situation and as such different business entities will favor different individuals. Please contact the office to set up an initial consultation.
Q. Should I incorporate my business?
A. Depending on your situation incorporating your business may be in your best interest. HHL Group is able to assist you with making the best decision financially and strategically.
Q. What expenses are deductible for a home office?
A. Various expenses are allowed to be deducted for a tax payer which uses a home office. These expenses can include electrical and cable utilities. However, certain exclusions apply. Please contact the office to set up a consultation.
Q. What kind of record keeping system do I need?
A. From an accounting perspective it is best to keep a record of all income (by city and state) as well as expenses. Be sure to keep receipts for business expenses as ‘proof of purchase’ should you be audited.
Q. How can a CPA help me as a new business owner?
A. A CPA can perform multiple services for business owners including business formation and bookkeeping. This will allow you the freedom to focus on growing your business and customer base.
Q. Do I need a business plan?
A. We believe that the key to a successful business is having a strategic business plan. Contact the office to set up a meeting to discuss business planning
Q. What Is a Financial Statement?
A. A financial statement provides a record of your business revenue, expenses, assets, liabilities and equity. Understanding these statements is important to the long-term success of your company.
Q. What’s so great about limited liability companies (LLCs)?
A. An LLC or limited liability company is a business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation. This limited liability protects the members of the LLC for acts or debts that are performed or incurred by the company.
Q. What are the “pass through” entities?
A. A “pass through” entity such as an LLC or partnership are businesses whose income passes through to the individuals who own it. The individuals taxable income is then derived in part from the business.
Q. What is the “corporate double tax”?
A. Double taxation is a principal which refers to the fact that income taxes are paid twice on income earned by corporations. The first time income tax is paid by the corporation and the second time when income is given to shareholders as dividend payments.
Q. What can I do to improve my business cash flow?
A. There are many things you can do to improve your cash flow. Opening up a low-interest line of credit can be one way to improve cash flow. But always be careful not to over extend yourself or your business.
Q. What deductions are the self-employed allowed?
A. Self-employed individuals are allowed many deductions including telephone, gas, and office supplies. We can work with you to determine allowable expenses for your business.
Q. How long should I keep my old Records?
A. Situations differ for every individual and business. Refer to our business retention records in the document library for leading practices.