General Business Tips Archives - Amy Northard, CPA - The Accountant for Creatives

Make Your Financial Goals Happen This Year!

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How to make financial goals happenI’ve already heard from so many small business owners that finally taking control of their business finances is one of their New Year’s resolutions. They recognize that this stuff has been a huge source of stress in their life and they know it doesn’t have to be that way.

Just like trying to lose weight or reaching a fitness goal, having accountability and guidance can make a huge difference in the results.

Accountability

So, you probably know where I’m going with this. If you haven’t been able to make yourself keep up with bookkeeping on a monthly or quarterly basis, it may be time to reach out for help. Start by finding an accountability buddy.

For me, it’s my husband. He’s interested in how my business is doing, so I like to have my books up to date when he checks in. For you, it may be another business friend who you report into once you’ve finished your monthly bookkeeping.

Money Date

In addition to finding an accountability partner, schedule a money date with yourself each month. It could be the first Monday of the month where you knock out your bookkeeping and review your business’s income and expenses. Check in with your financial goals to see if you’re on track to meet them.

If you’re looking for a little kickstart to get your finances in order, I’d love for you to join me in a 4 day challenge that starts Monday, January 9th. We’ll end the week with a video workshop packed with things you can do now to start the year off on the right foot.

Challenge workbooks will be sent out prior to the start (and they are so pretty!).

Sign up for the challenge HERE!

New Business? Do these three things first!

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New business? Do these three things first! You'll save yourself from a headache later on.There’s so much to do when starting a new business and it can get overwhelming fast. Let’s focus on three important things you should do right now before business picks up.

Already in business? No problem. These can be implemented at any time, it’s just best to get them out of the way first, if you can.

1. Open a separate business bank account

It’s super easy to make business purchases out of your personal account and toss the receipt in your purse, but I promise you’ll thank yourself at tax time if you get rid of this bad habit. If you’re a sole proprietor (the default business structure), you can go to your bank and set up another personal bank account using your social security number.

If you’re any other form of business, be sure to take your business formation documents, federal ID number, and anything else your bank may require. Call the bank or check their website for a list of information you’ll need so you don’t have to make multiple trips. Once you have this account set up, only use it for business.

Click here to see NerdWallet’s list of free business checking accounts.

2. Decide on a bookkeeping tool

There are a bunch of bookkeeping software options available, but my top three faves are Quickbooks Online, Xero, and Wave. With these cloud softwares you can automatically import and categorize your transactions which is a huge time saver when compared to manual entry in a spreadsheet. Once the transactions have imported into whatever system you choose, assign them each an income or expense category. Then you’ll need to do a reconciliation (which is like balancing your checkbook).

If the learning curve of a new bookkeeping software is too much, there’s nothing wrong with using a spreadsheet to organize your financial information. The key is to choose something you’ll do on a consistent basis so you don’t have to add everything up at the end of the year.

3. Research your sales tax obligation

As states try to round up funds, they’re turning their attention to sales tax as the solution. Many states are now requiring sales tax on select services in addition to tangible products, which in past years, had no sales tax requirement. Before you send your first invoice, get clear on whether or not your state wants you to collect sales tax on your products and services. This will save you an awkward conversation with a client later on if you need to add the sales tax and may also save you from paying out-of-pocket for the sales tax.

If you can’t find the answer to whether or not your product/service is taxable, you’ll probably save time by giving your state department of revenue a call. The best time to make this call is early in the week and early in the day. Because, let’s get real: no one answering phones is going to be super excited to get you info on a Friday afternoon!

Take care of business by finding out whether or not you should be collecting sales tax (even on services!)Tweet me!

Getting these three things crossed off your checklist will reduce your stress and set your business up with a good foundation.

Meet Idealust!

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idealustlifeI was contacted a little while ago by Becky, one of the masterminds behind the newly launched website, Idealust. She said she found me when searching for an accountant for creatives, which is always super exciting to hear since that’s what I’ve set out to be!  After Becky explained the concept behind Idealust, I was eager to see it come to life and thrilled that she asked me to contribute.

Becky was kind enough to do a little interview with me, which I’m sharing below. Check it out and keep an eye out for my current and upcoming contributions on Idealust!

Amy: What prompted you to create Idealust?

Becky: We are crazy about being creative entrepreneurs. We are wedding photographers (Limelife Photography) for those that see life as an adventure, for people wanting to make the most of every moment. Over the last 5 years, we’ve had so many awesome conversations with our clients, friends and industry co-workers about work and life and finding out what people would really do with their time if paying the bills wasn’t an issue. (We’re not delusional. We pay our bills!) Turns out, countless people we love wish they they were doing more of what they love. We realized it’s a pretty incredible life we have: working together, using our passions and talents for our job and getting to adventure when we want. It’s certainly not all unicorns and butterflies, but all the challenges and setbacks are worth it. It’s the life for us.

And it’s the life for so many other creatives who are feeling stuck and afraid or just aren’t sure what step to take next.

Amy: How is Idealust different than other entrepreneur blogs?

Becky: Idealust is about a lifestyle. It’s about building a business you love and living life to the max. There are business tips and practical tools, but there’s also a sense of adventure, freedom and balance. Oh, yes, lots of balance! Idealust is for creative entrepreneurs: designers, photographers, bloggers, stylists…entrepreneurs that appreciative art and beauty, not just business.

Amy: What has been the biggest struggle you’ve faced as an entrepreneur?

Becky: Patience. We always seem to want things to happen faster than realistically possible. Most things, related to growing a business, take time.

Amy: What do you dislike most about accounting/taxes for your business and how have you worked around it?

Becky: That it even exists! It’s definitely not our specialty. It took a couple years (much longer than needed) to get an organized system in place. Now, we have an accountant! We went 100% digital. We scan receipts and categorize them in Evernote immediately, once we get them. We now have a basic understanding of business accounting, so we know what we should be keeping track of.

Thanks Becky!

Does your accountant need to be in-state?

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does my accountant need to be in the same state?I have good news (for you and me!). Your accountant is not required to operate in the same state you’re living in. I’m currently working with clients all over the US and thanks to things like email, Dropbox, and the good old phone chat, I think we are pretty efficient!

One thing to keep in mind is that sales tax laws and business requirements do vary from state to state. This requires a little extra work on my part if there’s a question I can’t answer off the top of my head, but thanks to each state having a department of revenue I can contact, I’m pretty handy at efficiently getting the information I need for each state.

Now, I will say that there are some reasons why working with your old neighborhood accountant may be best. If you’re the type of person who needs to be in the same room as the person you’re working with and phone or Skype isn’t enough, you’ll want to start hunting for a local accountant. Also, if you have a complicated state-centered issue, like a sales tax audit, it may be best to search for a local accountant.

Minnesota Small Business Tax Links

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Minnesota Small Business Tax LinksWelcome to the second installment of my state-by-state look at small business tax links. Below are small business links for Minnesota, land of lakes, pretty cars, and the Mall of America. If you want your state featured, cast your vote here. California and then Washington are up next.

Positively Minnesota’s guide to taxes and starting a business in MN

Business licenses and permits

File and pay Minnesota taxes

Women’s Business Development Center – Minnesota District

SCORE – Minnesota District

Women Venture – Nonprofit aimed at supporting women-owned businesses

Did I miss anything? If so, let me know and I’ll update the list.

Just getting started?

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how to start a small businessNow that you’ve got your business idea nailed down, don’t let the accounting and tax side get you stuck in a feeling of being overwhelmed and defeated. Follow these 4 steps to get you started:

  1. Decide what business structure you will need.
    Sole proprietorship, partnership, LLC, S-corp? I will go in depth on each of these topics in the future, but for now, a quick Google search will tell you everything you need to know.
  2. Know what you’ll use for your Federal ID Number.
    If you’re a sole proprietor,. you can use your social security number. If you are going to operate under any other business structure, you’ll need an EIN number. Go to IRS.org and you can get an EIN in minutes.
  3. Look at your state’s tax website to determine what paperwork must be filed.
    You may need to register your business with your state. Their website should have a section for small businesses and what needs to be filed. When in doubt, call them. They’re usually pretty nice.
  4. Organize organize organize.
    Keep all receipts, invoices, bills, etc. in an envelope for each month. Once that month is over, you can grab your envelope and update your bookkeeping. Don’t let everything pile up in a big box for an entire year, or come this time next year, you’ll be sorry!

If this list is still leaving you overwhelmed, take it one step at a time. Don’t feel like you need to have everything done right now. It’s not possible and will only stress you out.

Are things like taxes & bookkeeping getting in the way of your creative time? Let's Chat!
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