Though it does take some focus, businesses should:

• Bill frequently
• Collect often
• Stay on top of billing and receivables
• Set up a monthly budget
• Compare the actual monthly numbers to the budget
• And make improvements based on these numbers

If you don’t have the time to manage your money, delegate it to someone who does. We all have our strengths. If your talents are put to better use managing operations and planning growth, it’s okay to let someone help with your cash flow and accounting.

An outside viewpoint can also help troubleshoot areas that may be causing you some difficulty. For example, if you are tying up a lot of your cash ordering and storing extra stock, consider how you could reduce your warehousing expense by ordering less and implementing a program to respond more specifically to customer demand closer to the time of purchase. You can also survey your clients to find out what they are interested in buying to shed some light on your ordering process.

Another idea is to focus on your marketing campaigns. Though it’s tempting to cut from your advertising or marketing budget, companies that boost their promotion and cut from other areas tend to experience better cash flow. It’s not about spending more; it’s about spending smarter.

Also, consider what you really need to have versus what you want to have when it comes to spending your cash.

For example, take a look at your internet or phone costs. Is the plan really suitable to your business? Have you been a loyal customer for a number of years and could ask for a discount? What about shopping around with other vendors and comparing prices?

You can also review employee benefits and see if there is a way of saving without raising premiums, especially if you have a small group of healthy employees. This may be possible simply be adjusting your deductible.

Adjusting your mileage reimbursement program can also save you money. By asking employees to visit several clients in one area at the same time or asking them to choose more economically priced flights, these savings will add up.

If you’re not quite sure where to start, many companies can offer a “health checkup” of your current money management processes. This often includes a questionnaire designed to help you think about your priorities and how well the systems you currently have in place are working.

For more information on how to improve your money management, contact a Beaton Accounting representative today at 631-921-6894.

Have a question or topic you’d like to see addressed in our next blog post? Just leave a comment or email us at info@beatonaccounting.com.

Recently, entrepreneurs have been developing programs to submit financial documents and receipts online and eliminate much of the cost of poor bookkeeping.

This helps businesses with their day-to-day finances and keeps them on track with good bookkeeping practices.

Instead of sporadic bookkeeping, businesses can use web-based technology to build consistency and make their records more manageable.

Essentially, these programs work by allowing employees to upload or e-mail documents, receipts and other files, as soon as possible after their transactions. These are then securely recorded and filed electronically. Clients can then choose to provide access to their accountants and have financial statements and tax returns prepared as needed.

Some solutions also allow you to scan your accounts payable and expenses and use tags to identify different files and documents, so everyone is on the same page.

These solutions eliminate much of the cost and headaches associated with poor bookkeeping.

For more information on online programs that can help you with your bookkeeping, contact a Beaton Accounting tax representative at 631-921-6894.

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment or e-mail us at info@beatonaccounting.com.

Not quite. All gifts, of course, do have a value, and depending on what that is, they may taxable.

The majority of gifts are not subject to the gift tax. Also, there is usually no tax for gifts to your spouse or a charity.

Most often, gifts are not taxable because they fall within the annual exclusion, which is $13,000 for 2011 and 2012.

You and your spouse can make a gift of up to $26,000 to a third party without paying a federal gift tax because it is considered that half of the gift is from you and half is from your spouse.

Gift tax returns do not need to be filed unless you give someone, other than your spouse, money or property worth more than the annual exclusion for that year.

And you generally don’t have to worry about any tax burdens being placed on the recipient of the gift. Most commonly, they do not have to pay federal gift tax or income tax on the value of the gift received.

Gifts do not ordinarily affect your federal income tax. Unless a gift is a charitable contribution, you cannot deduct the value of gifts you give.

To make things simple, here’s a quick summary of gifts that are not taxable:

• Gifts that do not exceed the annual exclusion for the calendar year
• Tuition or medical expenses paid directly to a medical or education institution on someone else’s behalf
• Gifts to your spouse
• Gifts to a political organization for its use
• Gifts to charities

You do have to file a gift tax return on Form 709 if any of the following apply:

• You gave gifts to at least one person (other than your spouse) that are more than the annual exclusion for the year.
• You and your spouse are splitting a gift.
• You gave someone (other than your spouse) a gift of a future interest that he or she cannot actually possess, enjoy or receive income from until some time in the future.
• You gave your spouse an interest in property that will terminate due to a future event

If you’d like to speak with a Beaton Accounting tax representative for professional advice on your taxes, call us today for a FREE consultation: 631-921-6894.

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or e-mail us at info@beatonaccounting.com.

Four tax credits that will boost your federal income tax return:

1. The Earned Income Tax Credit

If you earn less than $49,078 in wages, are self-employed or a farmer, you are eligible to claim the earned income tax credit! With our hard-hit economy, millions more Americans have seen a drop in their wages and are not eligible for this tax credit, which could qualify you for a credit of up to $5,751 depending on your income, age and the number of qualifying children you have already claimed. Even if you don’t have children, you can still qualify for this credit! For more information, check out IRS Publication 596, Earned Income Credit.

2. The Child and Dependent Care Tax Credit

If you claim qualifying children under the age of 13, you are eligible to claim the child and dependent care tax credit to help cover the expenses you pay to care for your dependent. A disabled spouse and other qualifying dependents also make you eligible. To learn more, review IRS Publication 503, Child and Dependent Care Expenses.

3. The Child Tax Credit

You can claim a maximum tax credit of up to $1000 for each qualifying child IN ADDITION TO the child and dependent care tax credit. This could be a huge tax return boost if you qualify! To find out more, see IRS Publication 972, Child Tax Credit.

4. The Retirement Savings Contributions Credit

Also known as the “saver’s tax credit,” the retirement savings contributions tax credit helps low-to-moderate income workers save for retirement. If you contribute to an IRA or workplace retirement plan (like a 401k), you may qualify for this tax credit, which is actually claimable in addition to any other tax savings you may qualify for. To learn more, check out IRS Publication 590, Individual Retirement Arrangements (IRAs).

If you have any lingering questions on tax credits or how to maximize your tax return, or if you prefer to have your tax return prepared by a professional this year, Beaton Accounting can help. All of our tax preparers are experienced tax professionals to ensure the accuracy of your filing and the maximization of your return.

Call us today for a FREE consultation!

631-921-6894

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com

Here are the 6 most important things to keep in mind this year as you claim more than just yourself on your 2011 federal income tax return.

1. Claiming an exemption reduces the amount your income can be taxed. There are two types of exemptions: personal exemptions and exemptions for dependents. Each of these exemptions allows you to deduct $3,700 on your 2011 tax return.

2. You CANNOT claim your spouse as your dependent. When filing a joint return with your spouse, you may claim one exemption for yourself and one for your spouse. If filing separate returns, you may claim a dependent exemption for your spouse ONLY IF the following applies:

- Made $0 gross income that year

- Are not filing a joint return

- Are not already being claimed as a dependent to another taxpayer

3. All of your immediate children qualify for a dependent exemption. Generally, each of your dependents qualifies you for an exemption. A dependent is your qualifying child or qualifying relative in your care. You must list the Social Security Number of any dependent you claim for an exemption.

4. If YOU are claimed as a dependent, you may still have to file your own federal tax return. Depending on the amount of your unearned, earned or gross income, your marital status and whatever special taxes you owe, it may be a requirement that you file your own tax return separately.

5. If you are claimed as a dependent, you no longer qualify for an exemption. Once someone else claims you on their federal income tax return (such as a parent or a spouse), you can no longer claim your own personal exemption on your own tax return.

6. Some people do not qualify as dependents. Spouses filing a joint claim with you do not qualify as dependents. In addition, any dependent you claim must be a U.S. citizen, U.S. resident alien, U.S. national or resident of Canada or Mexico for some part of the year. However, there are some rare exceptions to this.

If you have any lingering questions on claiming dependents, or if you prefer to have your tax return prepared by a professional this year, Beaton Accounting can help. All of our tax preparers are experienced tax professionals to ensure the accuracy of your filing and the maximization of your return.

Call us today for a FREE consultation!

631-921-6894

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com

However, some are finding themselves having to wait longer than expected for their refunds. The IRS warned of one-week delays at the opening of tax season due in part to more stringent identity theft protection measures, according to Accounting Today, but filers are continuing to have issues receiving their refunds within the standard 10 to 21 days.

Even though the IRS has set up the “Where’s My Refund” tool via the official government website, taxpayers have continued to be confused by inaccurate or delayed projections as to when they can expect their refund.

The IRS reminds taxpayers in their FAQs that “the date ‘Where’s My Refund’ provides is the estimated date the IRS will issue the refund, not the date the taxpayer will get the refund.” It can take an additional five days for the refund to be posted.

The IRS also asks that taxpayers avoid calling the IRS directly, unless they are prompted to do so on the website. Changing refund dates do not indicate a problem with the filing or that additional action is needed.

Taxpayers can check the status of their filing 72 hours after they e-file or 4 weeks after mailing their paper returns. To access your refund status, you will need your social security number, filing status and exact refund amount.  Also, keep in mind these tips on how to protect yourself from identity theft.

More answers to frequently asked questions can be found on the IRS website.

If you’d like to speak with a Beaton Accounting tax representative for professional advice on your taxes, call us today for a FREE consultation: 631-921-6894.

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com

According to the IRS, there are five filing statuses for an individual tax return: single, married filing jointly, married filing separately, head of household and qualifying widow(er) with dependent child.

Your filing status has a huge impact on your tax return. It determines your standard deduction, your ability to claim certain tax credits and additional deductions, and your correct tax amount.

If you’ve recently married or experienced a life-changing event, your filing status may have changed — or you may qualify for more than one status. Here are four quick facts about the most common filing statuses that will help you choose the best option for you individual situation.

1. Your marital status on the last day of the year (12/31) determines your marital status for the entire year.

2. If more than one filing status applies to you, claim the one that gives you the lowest tax obligation.

3. Single filing status generally applies to anyone who is unmarried, divorced or legally separated according to state law.

4. If your spouse died during the year and you did not remarry during 2011, you can usually still file a Married Filing Jointly return with that spouse for the year of death.

5. A married couple may decide to file their returns separately. In this case, each person’s filing status would generally be Married Filing Separately, not Single.

6. Head of Household generally applies to taxpayers who are unmarried. You must also have paid more than half the cost of maintaining a home for you and a qualifying person to qualify for this filing status.

7. You may be able to choose Qualifying Widow(er) with Dependent Child as your filing status if your spouse died during 2009 or 2010, you have a dependent child, have not remarried and you meet certain other conditions.

If you have further questions on your filing status, or prefer a professional tax preparer file your tax return this year, Beaton Accounting can help. All of our tax preparers are experienced tax professionals to ensure the accuracy of your filing and the maximization of your return.

Call us today for a FREE consultation!

631-921-6894

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com

With all of the personal information exchanging hands this time of year, it makes sense that criminals would target tax filers and tax preparers as prime victims of identity theft. These thieves steal your information in order to claim your tax return or tax refund for themselves, and they may even continue using your information to find jobs, make additional claims and more.

Here are few things you should know about identity thieves to avoid being the next victim:

-          The IRS does not initiate contact with taxpayers via email to request personal or financial information. If you get an email saying you’re being audited or getting a refund, it’s probably a scam.

-          Your identity may be stolen during tax season in a number of ways:

• Looking through your personal items (wallets, purses) when they are left unattended
• Looking through your trash for bills, invoices, etc.
• Posing as someone who needs your information
• Accessing information you provide to unsecure websites

-          Your social security number is one of the most important numbers you own. If stolen, the thief may use it to get a job, in which case the employer would file your thief’s income as your income. If the IRS tells you that you haven’t reported all of your income, you’ve probably become a victim.

To learn more about identity theft, secure websites and complete information on legitimate IRS activity, our tax professionals advise you to visit the official IRS website: www.irs.gov

If you opt to enlist a tax preparer this tax season to file your tax return for you, be sure to check out their policies on identity theft. In case something happens, you want to make sure that they will take responsibility for any foul play or loss of identity.

At Beaton Accounting, we ensure that all of our tax returns are completed safely and securely by a professional tax preparer. If you’d like to speak with a Beaton Accounting tax representative, call us today for a FREE consultation:

631-921-6894

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com

As you may have already figured out, the federal government’s recent decision to extend payment of unemployment benefits will affect the tax credit you earn for paying unemployment taxes. More specifically, it will shrink that tax credit — meaning you actually have to pay more.

This is because New York, New Jersey, Connecticut and Rhode Island are among the 20 states who have not repaid the money they borrowed from the federal government to these extended benefits.

So, when it’s finally time, here’s what you need to know.

Your “credit reduction” (a.k.a. the reason you have to PAY MORE) is calculated on Schedule A of the 2011 Form 940, the Employer’s Annual Federal Unemployment (FUTA) Tax Return.

For those filing through QuickBooks®, here’s something you’ll be relieved to hear. QuickBooks® DOES take this credit reduction into account and provides you with correct amount due, but it DOES NOT record an increase to your payroll liability account automatically.

Thankfully, we’ve found an article that shows you how you can this yourself, step-by-step. Click here to read it!

If you would like advanced QuickBooks® training in order to quickly file your own business taxes this year, Beaton Accounting can help. Our QuickBooks® ProAdvisors® are software gurus, and they can help you become one too.

If you’d like to take an even easier route, Beaton Accounting can file all of your business and corporate tax returns on your behalf! All of our tax preparers are experienced tax professionals to ensure the accuracy of your return.

Call us today for a FREE consultation if interested!

631-921-6894

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com.

One of the big changes is the introduction of Form 8937, which is called the “Report of Organizational Actions Affecting Basis of Securities”. This form is an informational return that requires issuers of securities to disclose actions they take that may affect holders of their securities.

For example, if your company issues securities, and at some point during the year your company takes an action (i.e. corporate tax merger, “F” reorganization, etc.) that would affect the basis of your holders’ securities, then you are required to report that action in a Form 8937. There is, however, some debate as to what types of actions qualify, so you should consult a tax professional for specific case analysis.

The idea behind this change is to give brokers and stockholders all the information they need to manage their portfolios, and also to make sure all affected parties have up-to-date information.

However, there are two very important aspects of this new reporting rule that you need to be aware of:

1. S-Corporations

If you are an S-Corporation, you can meet the reporting requirements by simply filing a timely K-1 schedule, thus making the 8937 form irrelevant for you.

2. Posting Online

Even if you are not an S-Corporation, you can get around having to file a 8937 by simply posting the necessary information on your primary website and making it available to the public for a period of ten years.

If you want to read more about this new form, you can access the IRS’s instructions for the form here: http://www.irs.gov/pub/irs-pdf/i8937.pdf.

However, if reading documents put out by the IRS is not your cup of tea (which makes you normal), feel free to call us at Beaton Accounting and we will be happy to explain the new form and its requirements to you.

Of course, if you are not inclined to file your own returns (as most business owners are these days), we have the experience and expertise to handle this for you for an affordable rate.