Planning for 2014

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Are you ready for 2014?

If you are like me, then you’ve already determined to make 2014 YOUR year!

Business planning for your small business during peak holiday shopping season can be quite a challenge, but in today’s post, I will share with you my approach which I hope will provide you with guidance on planning for your business in the new year.

Set Goals

What are you going to do differently in your business this year compared to last year?

This will be the first step in helping you to determine your business goals.

Come up with about 5-10 goals and then rank them in order of importance.

Some of my goals include:

  1. Revamp my website / launch e-commerce site
  2. Develop blogging strategy
  3. Integrate blogging and social media efforts
  4. Develop newsletter/marketing campaign
  5. Develop new product launches
  6. Plan 2014 holiday promotions

Breakdown each goal

Break down each goal into smaller tasks.

For example my goal to revamp my website and launch an e-commerce site can be broken down into five smaller tasks as follows:

GOAL

Tasks

  • Revamp website / launch e-commerce
  • Design website layout in PowerPoint
  • Determine number of products per page
  • Determine what features of Google Analytics to install
  • How to integrate ETSY shop with new website
  • Research online shopping platform (Shopify, WP plug in, etc.)

Set a Deadline

Decide on a completion date and work backwards to allocate a specific timeline to each goal.

Since my target deadline is the end of January, I will allocate 10 hours/week over the next 6-8 weeks to develop a concise strategy and implementation plan for each goal.

Create a Project Plan

To help keep you on track, create a project plan and checklist in Excel.

Monitor

On a monthly basis monitor your goals, results and adjust strategies as needed.

I’d love to hear what business goals and strategies you are implementing in your business in 2014?

Share it in the comments below!

Happy planning!!

by: Rekha Krishnamurthi

I Filed a Tax Extension in April. Now What?

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If your finances were out of control in April, you may very well have filed a tax extension. While a tax extension doesn’t extend the time you have to pay what you owe Uncle Sam (darn!), it does give you until October 15th to get your paperwork together and file your income taxes. Of course… October 15th is now rapidly sneaking up!

So what the heck do you do now that the time is almost up? Well, first of all, don’t panic. There’s still time even if you haven’t given taxes a single thought since April. But make no mistake – it’s time to get moving!

Filing, Not Paying…Maybe

Remember when you filed for your tax extension back in April you still had to pay? That was because the tax extension only worked for the actual paperwork and not for the payment. However, also remember that you probably didn’t pay the actual amount you owe.

Why? Because you had to make an estimate on your payment and send that in. Now you’re going to have to figure out the real amount you owe(d). This amount may be much different than what you sent before since you may not have taken every expense or bit of income into account.

Once you figure out the real amount you owe to the IRS just send it in with your filed paperwork. If you overpaid back in April, you’ll get a refund.

Still Time to Get Organized

If you’ve barely looked at your taxes since April (or plain forgot about them), it’s definitely time to bite the bullet. Hopefully you’ve at least organized your receipts and other paperwork so you can pull it out and get started. If not, might as well start there!

Make sure you have everything you need before you start. There’s nothing more infuriating than calculating all your deductions and then discovering another box of receipts. You only want to do this once so you can get it done with!

Pro Tip: If you still need help, use your free account with Outright. Calculations are much easier when we do it for you!

After you figure out exactly what you owe, go ahead and file. The IRS suggests using efile, their online payment system. If you’re filing via snail mail, make sure it’s postmarked by midnight on October 15th! If not, you may incur penalties and fees.

If you need more tax help, make sure to come on over to our Customer Care Center and ask away!

This post is brought to you by Outright.com, the easiest way to manage your small business finances online.

What to Do if You Catch a Tax Mistake

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There’s probably no worse feeling than realizing you made a huge goof. And when that error is on your taxes? Forget about it – sheer panic. You already sent in your 1040 and Schedule C to the IRS, so game over. Might as well jump ship and move to Australia.

At least, that’s what you would do if you didn’t already know about the 1040X. Wait, you don’t know about it? Well, let’s fix that right now! The 1040X is one of the handiest of the tax forms as it’s practically saved thousands of people from having heart attacks for years. It’s definitely one to know about.

What Is the 1040X Form?

The 1040X, or the Amended US Individual Income Tax Return form, is a way for you to send in a corrected version of your tax filings. If you ever realized after sending in a form that you forgot to include a 1099 or include a deduction (or put in one too many!), this is the form for you.

This year, one of the big selling points of the 1040X is the existence of late 1099-K forms. Some online sellers have even gotten them only a few weeks before the deadline! This meant that they had most likely already filed and now had a completely new form to file. Luckily, the 1040X was there to save the day.

The actual form takes a little while to complete. This is mainly due to basically having to do everything twice. You have to include the information that was incorrect on your original filing, also making sure you include the corrected version of everything.

You have up to three years after the initial filing was due (for instance, for 2011 taxes you would have to file the 1040X by April 17th, 2015), so there’s no huge rush. Take your time and get everything right the first…well, second time.

Particulars of the 1040X Form

There are a few particulars about the 1040X that are worth mentioning. For one, we mentioned taking your time to get everything right. Well, the IRS even says they recommend you wait until you get your refund or later before filing the 1040X. Why? Who knows, but it shows they’re not worried about getting your amendment instantly.

Also, there are a multitude of reasons to file an amended return. Did PayPal send a really late 1099-K? How annoying, but at least you can fix it. Just realized you could’ve deducted a portion of your mortgage and utilities because you operate your business out of a dedicated home office? That might result in a much larger refund – send in a 1040X as soon as you can.

If any of your fixes include a revised schedule such as a Schedule C to detail self-employment income and expenses, it’s a good idea to fill out a new one and send it in with the 1040X. Finally, make sure to be as detailed as you can when explaining the changes just so there’s no confusion on either end.

How to Make Your Accountant Love You at Tax Time

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If you think you have it bad during tax time, consider your poor accountant. Not only do they have to deal with all your craziness and random boxes of receipts you rush in at 10 PM on April 14th, they also have to put up with the same madness from their other clients!

This time of year is just as stressful for them as anyone else. After all, once they go home, they still have to do their taxes. The big difference is they know what it takes to keep it all together and you don’t – otherwise, you wouldn’t be hiring them, right?

But instead of pawning 100% of the responsibility off on them, there are a few things you can do to make their lives easier. As a result, you’ll more than likely get a better result on your tax return as well.

Get Organized

Obviously the first thing to go will have to be those boxes of random receipts. They’re not helping anyone and may be hurting your chances of getting a healthy tax refund. It’s time to get organized!

But your receipts aren’t the only thing you need to start categorizing. Everything else your accountant has to decipher and include in your taxes should be organized – expense sheets, profits and loss, the works.

This way, when a question arises, your account doesn’t have to spend hours looking for the answer – or, worse for you, calling you up wondering what the deal is. Once everything is in its rightful place, they can use all the detailed, organized info you provided and move on.

Make sure to use labels, too. It may seem like you’re helping using your own unique filing system, but if no one else can interpret it you’re right back to square one!

Don’t Be Ridiculous

“Yes, I would say I use all three of my computers solely for work.”

“Of course you should count my TV as a deduction, I put on smooth jazz when clients come over don’t I?”

“I wouldn’t say I’m quite in that tax bracket – some of this money wasn’t ‘serious’ money, more like hobby money.”

If you’ve ever heard words like these come out of your mouth, you probably also remember the look your accountant gave you shortly after. No doubt you want to try to get as much refund from the IRS as you can or lower your payment as much as possible. However, there comes a time when you’re just being ridiculous!

Making up silly stuff to try and expense or lying about how much money you made doesn’t help anybody…especially you when you get in trouble! People try to expense crazy things all the time. There was one case where a woman tried to say her gardening supplies should be a business expense as she worked from home and it was part of her company’s appearance!

So try not to stretch your accountant’s trust too thin. He or she is not there to work magic, they’re there to get you through April as unscathed as possible. Being honest with your business and the money within is a great step towards that!

1099s are Due to Contractors Today!

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The big day has come! No, it’s not suddenly Tax Day (April 17th this year) or your birthday. Today’s the day the 1099s are due to all the freelancers and contractors out there!

Now, if after reading that sentence you sat up in your chair and gasped, then you probably forgot all about this. Man, how in trouble are you? There’s probably nothing you can do to get everything out in time today right?

Not so! If you did almost have a heart attack after realizing what today is, there’s still a spot of luck for you so you don’t get hit with any fines.

1099s

First, let’s take a look at the 1099. You may not have been shocked into action because you didn’t realize you had to send them out.

So who gets a 1099? Typically, people who get 1099s are folks who you’ve paid for work but who aren’t on your regular payroll. Did a freelancer write blog posts for you over the year? Or how about an interior decorator that came in a few times to keep up your office? All these people were paid outside of your regular business, so they potentially need a 1099.

I only said “potentially” because there is another stipulation. For instance, did you know that you may not have to send a 1099 form to them if you owe less than $600? If over the course of 2011 you paid them $599 or below for their services, don’t even sweat it.

What’s on the 1099? Despite all the pressure to get these tax forms out on time, it’s a relatively simple piece of paper. The 1099 has basic information like name, address, and Social Security Number or Tax ID number, to identify the contractor/freelancer. To obtain this information, send your contractors an IRS form W-9. To make tax time easier, it’s beneficial to get into the habit of sending W-9’s to all contractors as soon as you hire them. Then, besides that information, the only other info you need is how much you paid to them in 2011.

Also keep in mind you must send your 1099 information to the IRS by March 31st. Many small business owners simply send 1099's to contractors and to the IRS at the same time to fulfill the obligation all at once. And a great solution for this is...

FileTaxes.com

Now, we mentioned there was something you could still do even in this super late hour. Our friends over at FileTaxes.com know all too well how tough it is keeping all the proper forms in line. Remember, you just have to SEND the 1099s out today; they don’t necessarily have to be in your contractor/freelancers hands.

To take the stress and mess out of filling out your 1099s, head over to FileTaxes and let them do the dirty work for you. All you have to do is create an account, enter your information, and print everything you need. FileTaxes.com will also e-file with the IRS for you. Now, your obligations are fulfilled and you can stop worrying!

Well, that is until April…but that’s why we’ve got the Small Business Tax Resource Center! We’ve got all the answer you need when it comes to taxes, and if we don’t, just ask away at Outright.com!

About the Author:
Laura Messerschmitt is the Vice President of Marketing at Outright, a free online accounting software for small businesses. She loves helping the self-employed and small businesses to be more successful and grow their businesses.

Tips for Preparing Your Business Financially for the New Year

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Happy post-holidays! We at Outright hope that you had the best winter holiday possible and, of course, that you got everything that you wanted.

But everything good must come to an end, and that includes hanging back and relaxing. Now it’s time for all of us to get ready for the New Year. More specifically, it’s time to get ready for all the tax time madness that’s soon to come.

To help you out, we’ve prepared a few tips to help you and your business ease into 2012.

Inventory

When do you usually take inventory? If you do it when it’s tax time, you’re more than likely misrepresenting yourself. For tax purposes, you want to record what you had at the end of the year, not what you have in April. This is because the taxes are for 2011, and you may have amassed some material in the beginning months of 2012.

Instead of writing items down to take inventory, consider taking pictures of everything. This way you can also visualize your stock instead of merely trying to organize a spreadsheet months from now.

Pictures

Speaking of pictures, snap a few photos of your home office or workspace at the end of the year. There are several deductions you can take if the space you work in qualifies as a home office for tax purposes, and these can add up to some big savings in April. Some of these deductions include phone bills, office furniture, and even a portion of rent/mortgage.

The pictures will help not only prove you own what you say, it can also help your tax preparer find even more deductions for you to use.

Get Rid of Some Money

I don’t mean just throw it out the door (unless I’m in the neighborhood, then go ahead). But there are special deductions for 2011 that can help you out if you can risk the extra expenditure.

For instance, there’s the Section 179 deduction. It allows small businesses to expense up to $500,000 in equipment purchases made in 2011. Did you have any big equipment purchases you were considering? See if you can buy them up in the last minutes of this year to get the deduction.

And of course there’s always charity, arguably a better use of your money. You don’t always have to give money, though. If you’re looking to buy new inventory, your old and unused inventory would make a good charitable donation. It can lead to some nice deductions on your taxes. Keep in mind, though, once you donate over $500 worth of goods, the rules and requirements get tougher.

Outright

In order to get a good read on your taxes before you actually file your taxes, take a gander at your Outright account. There, you can get a good idea what you may owe in taxes and if you should take action to get additional deductions. With a little foresight and planning you’ll be in good shape come April!

About the Author:
Laura Messerschmitt is the Vice President of Marketing at Outright, a free online accounting software for small businesses. She loves helping the self-employed and small businesses to be more successful and grow their businesses.