By Brenda Barnes bio
For many small business owners, summertime is often a slower time of year and a good time to take a look at your business. Even with half of the year gone, many business owners wait until year-end, or after the holidays, to assess their business needs. Taking the time now to review and adjust can help you make the most of the remainder of the year and more likely to enjoy a stress-free holiday season.
Review the first half of the year’s books and determine:
- Am I keeping my business and personal accounts separate? Doing so will help you maintain accurate and complete records of all business-related income and expenses.
- Are my estimated tax payments on track to meet my projected tax liability for the year? Often, we pay enough in quarterly tax payments to avoid tax penalties yet do not remit or save enough to avoid a lump-sum payment on April 15. Timely and accurate estimated tax payments will facilitate a more predictable cash flow.
Update your business plan and any financially related policies:
- Do I have a formal, written business plan and is it current? Ideally, every small business should have a written business plan. The process of putting your goals in writing and updating them mid-year and at year-end will help you focus on strategic planning, making key business decisions, and quickly adjusting to changes or shifts in your respective market or industry.
- Are my financial related policies current and how might changes impact my business plan? Often we forget that we have policies in place that greatly impact our business plan. Consult with your CPA now.
Evaluate your customer payment options:
- Are my payment options current and appropriate for my business? You may want to consider expanding or revising your customer payment options for improved cash flow. Do you accept credit and debit cards, prepaid or gift cards, PayPal or other methods of online payments, or mobile and “digital wallet” methods of payments? Now is a great time to evaluate your customer payment options and determine if they need to be updated.
Consult with your CPA/tax advisor:
- Am I being proactive in managing and filing my tax returns? Summer is often a slower time for CPAs/tax advisors as well. Making time now to meet with your tax professional can help you stay ahead of the game and stay organized and prepared on your business taxes. Spending time now reviewing expenditures with taxable implications such as business/personal use of a vehicle, business mileage, business meals/entertainment, or ensuring the capture of all business expenses can lead to better documentation habits and more accurate bookkeeping for your business in general.
Am I doing everything I can to minimize my tax liability for the year?
So you’ve been timely and accurate with your estimated tax payments mentioned above. Maybe you can actually reduce that liability to truly lighten your tax burden. Ask your tax professional about whether or not the following would work in your favor:
- adopting a qualified retirement plan;
- acquiring employee health coverage which may generate a tax credit; or
- considering acquiring equipment.
Conclusion
Whether summertime is your business’ “blues” time, or whether it’s your business’ non-stop, “rock-around-the-clock” time, it’s a great time to review, adjust, and plan for your business to make the rest of the year a success and move into the year-end holiday season virtually stress-free.
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