If you have decided to start a business and you have a limited budget at your disposal, or if you already have some kind of company running but it isn’t exactly swimming in profit, you are probably wanting to figure out a way to cut back on the various costs. The most common conclusion people reach is to do everything they can manage on their own to stretch the available money as far as possible. That’s a good strategy but does need some caveats.
Most notably, accounting and tax is one area that you should avoid doing on your own, if you possibly can. We know outsourcing costs you, but it actually saves you money in the long run by keeping you safe from losses due to amateur mistakes. You might want to read up on what the U.S. Chamber of Commerce has to say on common accounting mistakes at this link.
It would be okay to go it alone if you have an academic and professional background in business finances, or if you yourself are a certified accountant. However, if you have never had to manage business books before, if you thought you could pick it up on the fly, let us tell you right now, you thought wrong. Making a slip up in your own numbers can deal some serious damage to your business, both now and in the future.
For the purposes of this article, we are going to assume that you are a small business owner, but you can adapt this information to your needs at any level, really. Let’s see what benefits come with hiring out your tax consulting and accounting needs. To keep things grounded, let’s focus on one niche of financial issues. So, we will be looking at property accounting and property tax here.
When you are just starting out
When you make up your mind to kickstart a new business, you will need to set up a whole host of things to prepare the ground for your success. So, let’s suppose you are starting out and you need business space. Maybe you need just one small office, maybe a whole hive of them, or you might require something like a building site or a stretch of farmland. You will need to either rent or purchase this property. Now would be the time to consult a property specialist accountant and be guided on how to begin.
Here are some of the things that they can help you with.
Business structure
First up, they can help you figure out the most suitable business structure for the venture you have in mind. Your options include, among others, a partnership, a sole proprietorship, starting a corporation or an LLC.
The size and corporate structure of your company will also have bearing on your property requirements, and depending on the particular industry you plan to deal with, there might be specific regulations for how to maintain that space (e.g. safety standards in agricultural or architectural scenarios).
Financial analysis
A specialist accountant and tax advisor is invaluable in financial analysis of your plans as well, whether your idea is viable in the market. They can advise you on the kind of accounting software that’ll best suit your needs, and even teach you how to use it. They can offer help and advice on opening up a business bank account, if you have no prior experience with that, as it is a somewhat different story from a regular citizen’s personal account.
Compliance
Also, hiring an expert will ensure that all of your financial procedures are in compliance with relevant government regulations. Different states and counties might require slightly different things from their property owners or renters, so you should always make sure you are up to date on the nitty-gritty of the legislature where you live.
This can get overwhelming and tedious, so an expert property tax adviser and property accountant will be your lifesavers at this point. Learn more about how state and local tax property tax policies work in this guide: https://www.taxpolicycenter.org/briefing-book/how-do-state-and-local-property-taxes-work
In addition to all of this, your property financial experts will help you keep track of all the property-related expenses over time, such as rent, maintenance, repairs and so on. And if you feel any confusion as to keeping your personal and business spending neatly separated, they can illuminate you ion that point too.
When it is time to grow your business
In addition to helping new business owners get their grips on their beginnings, property specialists can help you out when you want to expand your venture as well. They can take a look at your cash flow and offer some good pointers about your pricing, overall financing, managing your inventory etc. to help you identify where you have room for growth. This is especially important if you decide to put your property or equipment under lease.
If you’re worried about getting audited by the IRS, they can help you evade that scenario – or if it already came knocking, they can help you prepare for navigating it. On that note, an audit is typically the consequence of some less than ideal financial decisions on your part. To aid you in preventing a reoccurrence, your accountant and tax adviser can do a so-called financial forecast. This can be done specifically pertaining to your property expenses, or you may wish to consult a non-specialized accountant to get a look at your business as a whole.
Selling your business
In the end, if you should ever decide to sell your business – if it goes that badly or that brilliantly well – you will appreciate an expert’s perspective on that too. Business property sale can sometimes be especially tricky, especially if the potential buyer aims to use it in a way different to what you have been doing.
This has been a general overview of how your business can benefit from hiring a property tax adviser or accountant. To get more specific advice, ask for some consultations regarding your specific business plans.
Interesting related article: “What is a Consultant?”