I always find it interesting when someone, who is not a true expert in an industry, has the confidence to give advice on the topic. Possibly even more intriguing to me, is those that are listening, take the advice and use it, or attempt to.
I was recently in a group discussion while networking. There was a very interesting conversation about bookkeeping. Sam, name changed to protect, is not in the ‘numbers’ industry, but had many suggestions on how to handle bookkeeping, for all those in ear shot. One suggestion he made, pierced my eardrum. He stated that he paid a painter for work done in his office, that’s not the piercing part. The painter was operating as an LLC. Sam didn’t require a W9, the form used when payng a subcontractor/independent contractor without withholding income tax. “The painter was not subject to a 1099 because of the LLC” said Sam. That was the piercing part. Sam also paid the painter for the paint, but the painter kept the receipts. The issue wasn’t with the amount paid, but the statement of who should or should not be required to present a W9.
Mid-year is every July for some IRS regulations and requirements, no matter when your business year-end falls.
Take control of your schedule and uses these steps to save time, money and to avoid blazing inferno’s, mainly your frustration for not preparing.
Exchange the vendor’s W9 and Insurance Certificate for the payment you owe the vendor. Even if you don’t feel you will reach the required filing threshold, you will have the documents should the need arise.
Go over the details that bottlenecked your year-end and tax return process last year and develop and document procedures to simplify the process.
Prepare all your paperwork at the start of the process, eliminating the starting and stopping of preparing taxes and other forms that have strict IRS deadlines.
The tax laws are changing. Meeting with your Bookkeeper and CPA would be a great use of time.
Morale of the story, your CPA and Bookkeeper have the knowledge and experience to guide you. Utilize them. When the IRS sends you the bill, Sam won’t be there to pay it.