Tips to ensure your business survives the Coronavirus pandemic

The COVID-19 pandemic is affecting businesses differently depending on a variety of factors including industry, location and mode of operation.

Regardless of your industry, the economic impacts are wide reaching in the economy so every business owner is encouraged to take the time to assess and plan. Use the current climate as an opportunity to establish a good foundation to help your business adapt and grow.

Ask yourself some hard questions such as "could I lose my client's over this?". If things continue the way they have, with the way that you're running your business right now, will you be able to continue serving your customers? Is your business being interrupted because you're being forced to close due to curfew or mandatory closures? Is your supply chain being disrupted?

Evaluate your risk, and then think about what you can do to minimize the impact.

Check your insurance coverage

See if you have business interruption coverage, and see what the coverage is. Not all policies will cover interruptions from this, but it's possible so you want to make sure that you understand what your options are.

 

Identify alternative sources of revenue

Start thinking of alternative things that you can tweak to help your business survive and to help keep money coming in. This may include providing digital or DIY versions of your services, running promotions on gift cards for clients to use once things go back to normal or adding an eCommerce component to your business.

 

Identify non-essential expenses

This is a time to run as lean as possible. You may have signed up for a program or subscription with good intentions of utilizing at some point in our business to run more efficiently. Or perhaps that subscription is for the benefit of physical customers that won’t be coming in for a while.

The fact is as business owners we get pulled in a million directions and unfortunately we end up paying for services that we aren't using. Now is a great time to look at services and subscriptions you're paying for that you are not using or temporarily pausing due to the COVID-19 crisis. Perhaps you have been paying advertising that hasn't been generating results. Look at your profit and loss statement and identify the must have expenses to properly operate your business and remain compliant. You want to be thinking both short term and long term.

 

Check your business’s financial health

Review with your accountant or bookkeeper your cash reserves, make sure that you're looking at all of your assets, look at their liquidity, how quickly can you convert them into cash if necessary? Also look at your cash flow, how has your money been flowing so far? Do some forecasting, creating some trend scenarios, how things could play out.

If all income stops suddenly, how long can you pay your bills for? This is a time to be very frank and think about the worst-case scenario, just so you can make informed decisions going forward. For you to be able to do this you will need to have a good set of books to properly evaluate your current expenditures and identify anything that isn't truly essential. If your books are not up to date or accurate, this is the time to address that.

 

Use credit wisely or don't use it at all

Using credit, either in the form of your existing credit cards, lines of credit or through economic disaster loans, is something you want to use credit as a last resort to keep you in business and after careful planning and consideration. Do not rely on credit to carry your full load overhead and administrative expenses if you normally wouldn’t be able to afford the payments when things are back to normal.

 

Tweak your marketing strategy

Identify what is working, what is not and needs to change. You may want to increase your use of social media and change your messaging to get in front of more customers as everyone is home on their computer or phone. If you find yourself with events being canceled, customers not coming in and prospects drying up, you will have time that you can use to work on your marketing strategy to make things better.

Keep communication lines open with your customers, If you have a mailing list or social media, you can send newsletters or do live videos to keep them engaged, nurture it, they'll remember that.

 

Use your time effectively

Create that content that has been on your to-do list for weeks or months, organize your admin files, review your calendar and make sure it is accurate, get your receipts and tax documents to your accountant, revamp your systems and workflows so you’ll be more efficient when things pick up again.

Don't waste this time feeling sorry for yourself because that is not going to be beneficial for your business. Learn, read, take courses, there may have been courses that you have purchased and then got too busy to finish. This is an opportunity for you to have a good foundation put into place to help your business thrive in the future.

 

Right now, it looks like the disruptions are only for a couple of weeks, but some sources indicate the effect will last months for some business and years for the economy as a whole.  So be proactive and not reactive in your adaptability to change how you do business.

COVID-19 Resources for Small Businesses

There are a lot of questions about the impact of the current situation in our businesses.

Here is a collection of links with useful resources:

Additional information will be shared on our Facebook page, YouTube and our other social media channels.

The media is reporting a lot of different things that are being planned to help small businesses. Please remember that just because something was announced at a press conference, it doesn't mean that it is approved and ready to be implemented.

I encourage you to not count on anything proposed until it has been signed into law and officially announced by a government agency because proposals can be modified, delayed or not implemented at all.

Private enterprises are also coming up with programs to assist businesses so I encourage you to keep an eye out for media announcements on those in case you are eligible for any of those initiatives.

We are all in this together and together we will overcome the challenges.

Our Favorite Tools for Remote Work

Woman working from homeAs a fully virtual business, we have a "tech stack" that is optimized for working remotely.  As more businesses are having to suddenly switch to a remote work model due to the disruptions from the COVID-19/ Coronavirus pandemic I am listing our most frequently used tools here in hopes that it will help you narrow down the options in your search.

Virtual Meetings- Zoom

We use Zoom for all meeting, it's easy to join via computer, via mobile app, by dialing in via phone. We usually use video but you can also have audio only meetings. We can share screen, do remote control, record and much more.

Popular Alternative: Skype for Business, Google Meet

 

File Storage- Google Drive

This is not the same as the free Google Drive designed to store personal photos. We use GSuite aka Google for Business which has security and other features that the free version lacks. GSuite offers a lot more than just file storage, we also use it for email, calendar and more. All of the tools are built with remote collaboration in mind.

Popular alternative: Dropbox

 

Task Tracking/Project Management- GQueues

This tool is built specifically for GSuite which is why we love it so much as it integrates seamlessly with our calendar and email so nothing falls through the cracks and we can time block, it's easy to assign tasks and all team communication stays together with it's corresponding task/project.

Popular alternatives: Asana, ClickUp

 

Team Communication- Slack

We don't "need" this tool because all work related communication is in GQueues and linked to the relevant task/project. We use Slack for general "water cooler" type of conversations, sharing funny memes, links to articles and general chat to maintain our team bond and corporate culture but it can do so much more. We don't use it a whole lot but it's nice to have. I know a lot of teams that use this as their primary tool for all team communication instead of email.

Popular Alternatives: Google Hangouts, Microsoft Teams

 

Video Communication- Loom

While we use Zoom for real-time video communication.  Loom is great for asynchronous communication where it's faster to demonstrate something than to try to explain it in writing or by phone.  You can record your screen, your camera or both and talk while showing how something is done.

 

Password Security- Lastpass

Security is of the utmost importance and this means using complex and unique passwords that get changed often. The only way to achieve this is by using a password management app. We are able to share logins securely and use their Authenticator app for 2 factor authentication which is safer than SMS verification.

Popular Alternative: Dashlane

 

VPN- NordVPN

Cyber security is critical in our business and for this reason we don't do any work without using a VPN to encrypt our internet connection.

Popular alternative: ExpressVPN

 

Remote Computer Access- Splashtop

While we no longer have a need to remotely access computers because all of our tools and files are in the cloud. I realize that you may need this type of tool when first getting started in transitioning to virtual work. We loved Splashtop in the past.

Popular Alternative: Teamviewer

 

Check out our YouTube channel for videos on tips on how to help your business survive the economic impacts of the Coronavirus and working remotely while your kids are at home.  Feel free to share your comments or video/blog ideas.

We are happy to assist our clients with any questions about these tools or remote work to help your transition during this difficult time.  Stay well.

2020 Federal Tax Due Dates

Tax due date
A calendar reminder that Taxes are Due

Filing your taxes can be confusing with trying to track the different due dates and forms. You don’t want to get it wrong and incur penalties.

This simple list covers the most common federal tax due dates so you can enter the ones that apply to you in your calendar. Make sure that you also research your state tax obligations if applicable so you don’t miss those.

 

Annual Tax Filing
Individuals and Families – Annual personal income tax filings (Form 1040) are due on Wednesday, April 15, 2020. The majority of people file a 1040.

Corporations (including S and C Corps) – C corporations (Form 1120) also file on April 15.

S corporations (Form 1120S) and partnerships (Form 1065) file on March 15.

 

Estimated Tax Deadlines For 2020
Payments for estimated taxes are due on four different quarterly dates throughout the year:

1Q — April 15
2Q — June 15
3Q — September 15
4Q — January 15 of the next year

 

Estates and Trusts
Estates and trusts file Form 1041. This is also due on April 15, 2020.

 

Extension Due Dates
Extended returns have different filing dates depending on the type of tax form being filed:

Form 1065 extended return — September 15
Form 1120S extended return — September 15
Form 1041 extended return — September 30
Form 1120 extended return — October 15
Form 1040 extended return — October 15

5 Common Bookkeeping Errors

Whether for tax compliance, to apply for financing, to attract investors or for internal decision making, having accurate books is important to your business health.

Below are some of the most common bookkeeping errors I see:

1- Not having any books
If you are in business, shoving your receipts in a shoe box and looking at your bank statements at the end of the year to file your taxes is not enough. You need to keep detailed records to be in compliance with IRS recordkeeping requirements.  Also, having a set of books gives you the information to know if what you are doing in your business is working and what needs to be tweaked before it’s too late.

The best time to start is today, the longer you wait, the harder it will be to get caught up which brings us to the next error…

2- Outdated Books
You started a set of books, you setup your accounts and then business and life got in the way and it’s been months (if not years) since you touched them. It’s easy for transactions to be missed the longer you wait to record them. It’s also harder to remember what a transaction was for or what you did with the receipt for it months later.

3- Incomplete Books
You’ve done some part of the bookkeeping but not all. For example, the accounting software was used to create invoices but not entering expenses. Bookkeeping is somewhere where “some of it” isn’t good enough. It’s important to have a complete financial picture of the financial health of your business.

4- The Books haven’t been reconciled
You never want to file your taxes before reconciling your books, you could be leaving money on the table and not know it!
Reconciliation means that all of the transactions for the period and ending balance match the statement. This ensures that no transactions are duplicated or missing. Unfortunately, checking off the check register and adding from the bank feed doesn’t replace reconciling your accounts. The only way to know that your books are actually accurate is by reconciling them.

5- No source documents
Your bank or credit card statement is not enough to substantiate a tax deduction (IRS Burden of Proof). Making sure that you have all of your source documents organized and accessible will get you a step closer to having audit proof books. These documents include bills, receipts, cancelled checks, etc.

An ounce of prevention in the form of up to date and accurate books can yield a pound of peace of mind in the case of an audit.

How to get QuickBooks Support without getting ripped off

In this day and age when we want to find the phone number for a business, we Google it.   That usually works very well as long as you are not looking for the phone number for technical support for QuickBooks.

Unfortunately, there are many companies that are not affiliated with QuickBooks that pose as QuickBooks technical support and oftentimes, their phone number is the first to pop up when using a search engine.

The quality of their support will vary but I’ve seen some users be ripped off by paying thousands of dollars for services  that didn’t solve their problem or paid to receive troubleshooting that Intuit support provides at no extra cost.  In the worst cases, users have had malware installed in their systems and their identities compromised.

Which phone number you get when searching online will vary depending on the search engine and the keywords used.

So how can you make sure you get the number to the legitimate customer support department at Intuit and not some random third party?

Intuit has several QuickBooks products so there isn’t a global number for all support.  The contact information will depend on the product that you have.  Your best bet is to contact them from inside the QuickBooks product that you use to ensure that you are routed to the correct department.
  •  In QuickBooks Online, simply click the “Help” link on the top right hand corner of the screen.
  • If you use QuickBooks Desktop 2017 or later, press F1 or select Help > QuickBooks Desktop Help to get help faster.

If you are looking for information on how to do something inside the program, you can visit https://quickbooks.intuit.com/learn-support/ to access tutorials and an online community to ask questions.

If you need bookkeeping help or training on how to use QuickBooks Online, we can help.

Important Business Tax Deadlines for 2019

At some point every year, business owners begin scrambling as they try to figure out what forms they must file and when they must file them in the new tax season.

Here are some other important deadlines to keep in mind.  This is not a comprehensive list, please consult with your tax advisor for any other deadlines that may apply to you. State deadlines will vary, please check with your state for applicable deadlines that apply to your business.

Estimated Taxes
The fourth and final estimated payment for the 2018 tax year is due on Jan. 15, 2019.
Estimated tax payments for the 2019 Tax Year (IRS Form 1040ES)
April 15, 2019
June 17, 2019
Sept. 16, 2019
Jan. 15, 2020

W-2 and 1099 Reporting
January 31, 2019- Deadline for employers to mail out W-2 Forms to their employees and for businesses to furnish 1099 Forms reporting, among other things, non-employee compensation, bank interest, dividends, and distributions from a retirement plan

February 28, 2019- Deadline for businesses to mail Forms 1099 and 1096 to the IRS

Partnership returns (IRS Form 1065):
March 15, 2019
Extended deadline is Sept. 16, 2019

C-corporation income tax returns (IRS Forms 1120):
April 15, 2019 for C corporations that operate on a calendar year
Extended deadline is Oct. 15, 2019
The deadline for C corp returns is the 15th day of the fourth month following the end of the corporation’s fiscal year if the corporation is on a fiscal rather than a calendar year.

S-corporation returns (IRS Form 1120-S):
March 15, 2019 for corporations on a calendar year
Extended deadline is Sept. 15, 2019
The deadline for S corp and partnership returns is the 15th day of the third month following the end of the fiscal year if they are on a fiscal year rather than a calendar year.

Individual Tax Returns (Form 1040)
April 15, 2019- Deadline to file individual tax returns  for the year 2018 or to request an automatic extension (Form 4868). An extension provides an extra six months to file your return. Payment of the tax is still due by April 15. You can submit payment for any taxes you owe along with the extension form.

What If You Miss a Date?
The IRS says you should file your return as soon as possible if you miss a deadline. If you owe taxes, pay them as soon as possible as well. You’ll probably be hit with a moderate financial penalty, if only an extra interest charge, but the IRS should accept your money and your return and that will be the end of it unless there’s another problem.

If you owe money and don’t want to send a check to the IRS via snail mail and risk all the extra time that might entail, go to IRS Direct Pay and have the payment debited directly from your bank account. You might also want to e-file your late return if possible if you haven’t missed that deadline. Most taxpayers can do that at IRS Free File. The IRS will accept e-filed returns up until Oct. 15.

And if you can’t pay the tax you owe immediately, don’t delay. File your return anyway and immediately apply for an installment agreement. The IRS will let you pay over time as long as you make arrangements to do so.

6 Steps for a Year End Ready Business

checklistTo help prepare for a smooth transition at the end of the year, here is a handy checklist for what you can start doing now to make your life easier at tax time.

1- Reconcile accounts

If you subscribe to any of my bookkeeping packages, this is done for you!  Just make sure that you check your email for any information requested and after you have ensured that I have everything I need.  Kick back, relax and then move on to the next step.

2- Capture fixed assets

Did you make any big purchases that should be recorded as an asset (generally an item that costs $1,000 or more with a useful life of more than a year)?  You may want to ask your tax preparer if they want any purchases less than $1,000 tracked as fixed assets since there is no rule on this amount.

3- Identify all 1099 Vendors

Review the vendor payments so far this year to be sure that you have W-9 forms for all vendors who have (or will be by year end) paid $600 or more and are not a corporation.  Do not wait until the end of the year to get this information since some vendors are not eager to provide this information and the deadline to file forms 1099 is January 31st.  Save yourself the stress and get this information now!

4- Verify Employee Information

If you have payroll, it’s good to check in to be sure that you have all of the information needed to issue correct W-2 forms, including the employee’s current mailing address.  An easy way to do this is to have your employees review and update their most recent form W-4.

5- Review your unpaid bills and unpaid invoices

Check on any old but still open vendor bills and well as any customer invoices to verify that they are valid.  You may find some loose ends that need to be fixed or old amounts that need to be written off.

6- Review and update inventory

If you carry inventory, review the account to find out when it was last verified and what is actually on hand.  Plan to conduct a physical count and make adjustments before the year ends.

Record Retention Guidelines for Businesses

Keeping payroll, HR and financial records indefinitely dramatically increases the risk of identity theft by hackers.

Shred sensitive documents no longer needed and wipe them off computers, printers, copiers and other equipment. Don’t rely on using File Manager because they do not insure that the wiped data cannot be hacked. Be especially careful if your business donates, sells or returns leased equipment to other organizations.

Outside vendors that manage asset disposal can help, but they also pose risks. Choose a vendor that:

· conducts background checks on employees;
· offers risk indemnification;
· tracks assets during the disposal process; and
· disposes of your equipment in an environmentally responsible way.

Minimizing unnecessary storage

There are different guidelines for how long to keep business v. personal data:

General rules
Retain records that support items shown on your tax return at least until the statute of limitations runs out — generally three years from the due date of the return or the date you filed, whichever is later. However, there’s no statute of limitations if you fail to file a tax return or file a fraudulent one. So you’ll generally want to keep copies of your returns themselves permanently, so you can show that you did file a legitimate return.

· Employee records—keep for 3 years from termination.
· Employee earnings records—keep for at least 4 years after termination. For records involving unclaimed property, such as an unclaimed paycheck, check state laws.
· Timecards—keep for at least 3 years if your business engages in interstate commerce (i.e. is subject to the FLSA); at least several years, regardless.
· Employment tax records—keep for 4 years from the latter of the date the tax was due or the date the tax was paid.
· Travel and entertainment records—keep mileage logs, receipts and other supporting documents for 4 years (IRS rules).
· Sales tax returns—keep as long as state law requires.
· Business property—keep records that substantiate costs and deductions (purchase, depreciation, amortization and depletion documents) until the asset is sold, traded in or disposed of plus 7 years, according to IRS guidelines.

When in doubt, don’t throw it out
It’s easy to accumulate a mountain of paperwork (physical or digital) from years of doing business. If you’re unsure whether you should retain a document, a good rule of thumb is to hold on to it for at least six years or, for property-related records, at least seven years after you dispose of the property. But, again, you should keep tax returns themselves permanently, and other rules or guidelines might apply in certain situations.

2018 Tax Deadlines for Small Business

It’s easy to lose track of deadlines and be scrambling at the last minute, or worse, forget! There’s nothing more frustrating than having to pay a fine that could have been avoided.

Below is a list of tax filing dates and important deadlines for the 2018 tax year. Take a few minutes to save each relevant filing date to your calendar.

January 17, 2018:
Estimated Quarterly Payments
Note: Individuals, you do not have to file this payment due on January 17, 2017—so long as you file your 2017 tax return by January 31, 2018 and pay the remaining balance owed with your return.

January 31, 2018
Form W-2 Filing Deadline
Form 1099-MISC Copy A Filing Deadline: If you are filing a Form 1099-MISC and reporting amounts in Box 7, this deadline applies to you.
Copy A must be filed with the IRS by this date. Copy B must be furnished to the contractor no later than February 15, 2018.
If you don’t have amounts in Box 7 on your Form 1099, February 28 is the deadline for paper filing or March 31 for electronic filing.

February 15, 2018
Form 1099-MISC Copy B Filing Deadline

February 28, 2018
Form 1099-MISC Copy A Filing Deadline
If you work with independent contractors, this filing deadline applies to certain types of 1099s. If you are filing Form 1099-MISC and don’t have amounts in Box 7, February 28 is the deadline for paper filing. March 31 is the deadline for electronic filing.

March 15, 2018
S Corporation and Partnership Tax Returns Due

April 17, 2018
Estimated Quarterly Payments
Individual Tax Returns Due
Corporation Tax Returns Due

June 15, 2018
Estimated Quarterly Payments

September 17, 2018
Estimated Quarterly Payments

December 31, 2018
Tax Moves Deadline- any tax saving moves for the year need to be done by today.
Deadline to set Up a Solo 401 (k)

The filing dates listed above are relevant to your business’s federal tax return. If you plan to file for an extension of state taxes, you’ll need to do that separately.

Depending on the nature of your business, you may also need to meet other filing deadlines and requirements not listed in this post. Do your research and work with your tax preparer early on to ensure you’re well aware of your filing obligations throughout the year.

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