Throughout the tax season, I felt like I spent more time in this space talking to my individual clients than businesses. This makes sense, for even business owners are filing personal tax returns, making it a topic with which everyone has some familiarity.

A couple of weeks ago, though, I got to mention National Small Business Week and express how much we love working with businesses, and the new worlds to which it can expose us. I want to continue to take the time to address businesses more now, and to do it with one question:

What do you want to do next?

I have mentioned similar ideas when it came to personal finances, urging people to take tax season as a time that can indicate where you need to make some improvements in your finances, record keeping, overall organization, or anywhere else. Just it is a time where everyone feels some stresses, so it is a good time to figure out how to combat that stress. And although I do think it is important for us to spend time thinking about ways that we can improve our personal lives – in every area – but it may be even more important for businesses to take this type of self-review.

After all, the health and well-being of a business plays a giant role in the health and well-being of its business owner. This connection happens whether your business is a side hobby or if you’re at the head of a multi-million dollar corporation. Many of those corporations rose from smaller entities, and they got there by knowing the answer to:

What do you want to do next?

I wrote recently about the passion that I love seeing in business owners, but running a business is also work, and like any type of work, there are times when it feels heavy, too much to handle, and we wonder if it is all worth it.

First, chances are that it is worth it, for you would not have started the journey if it was not. So when those heavy times come, figure out what is triggering those feelings: are you not profitable enough, do you need to hire more employees, do you need to fire old employees, do you need to contract outside help for some areas of your business? Find where the issues are, and envision how they can be fixed. In there is probably the answer to:

What do you want to do next?

I understand that not every owner has the means to immediately solve those problems. Finances do not always allow it, but that doesn’t mean you should avoid the answer. If you are not yet where you want to be, that does not mean that you shouldn’t envision where you want to be. In fact, because it’s not happening yet is why it answers the question:

What do you want to do next?

To achieve goals, one needs forward motion. There are rarely magic buttons that provide answers that get us to where we want to be in life or in business. The journey can be long, and it can be arduous. Do not let that frighten you away, for most of the things worth doing in life, the things that we look back on most fondly, are the ones that were difficult to achieve. They’re never achieved through giant leaps, but one step at time. So …

What do you want to do next?

And as always let us know if there is any way we can help you get there.

It is National Small Business Week, and coming from a small business myself, I guess it is not that wild that I am mentioning it. The fact that you are reading this, though, shows that you enjoy engaging with small businesses. With both of these things being true, if there is some small business purchase you have been thinking about, it could be time to go through with it, you know, to help them celebrate.

Or maybe it is time to start thinking of running a small business of your own.

One of the best parts of being in this business is meeting people who embark on that quest. We get to see the passion they have that drives them to bring it to the public and share it with others. I recommend working with passionate people as much as you can, for even if your passions do not lie in the same area, it is infectious. This leads to us doing all we can to help these businesses succeed and at the risk of a little conceit, we believe that assistance helps lead to success.

For you see, those passions I mentioned do lie in different areas. Businesses are rarely started because someone is excited at the idea of tracking finances, keeping clean books and going over profit and loss statements. I say rarely because some of them are, and that is done by those of us who love to specialize in that area.

Many others, though, do not realize the importance of such things when they go into business. Without keeping good track of your numbers, purchases, sales, and balances, though, you will not thrive as much as you could. Even if business is booming, opportunities to be more financially efficient will be missed because finding them is not a priority. If business is not booming, not paying attention to such things could lead to the business’s demise.

I am sure some of you reading this may not have even thought of the services we perform for other businesses. As you have learned over the past few months in this space, a lot of our business involves filing taxes, and we are very thankful for those clients who only use us for those services. But if you ever find yourself branching into new areas – or looking for new help in some old areas – know that we would love to help you if we can, or point you in the right direction if we cannot.

And being aware of what one cannot do in business is important. You should concentrate on what you are best at and what brings you the most fulfillment. This is bound to not be every task that needs doing in a business, though. You should then let the expertise of others work for you, which then lets the expertise of others free you up to do more of what you want to be doing in the first place. It is that passion that makes small businesses worth celebrating, why we are proud to be one, and are fulfilled by helping others.

After last week’s breather after the end of tax season (and I still say I deserved it), there are a few lingering ideas I want to mention before maybe leaving taxes behind for more than a week at a time over the coming months.

First, for those who have finished their tax work for the year, one may start to wonder what to do with all the paperwork you gathered to file your return. Well for now, keep it. If supporting paperwork was necessary for your return, right down to every receipt, it is best to bundle everything together just in case you end up needing it. I wrote a few times over tax season about the chances of an audit, so I do not want to go back into it here, but let us just go with the idea that there is a non-zero chance you could face one. Even if you filed the most accurate and legal of tax returns then, it is best then to keep all of those papers and forms together.

But for how long?

I don’t want to go into the minutiae of recordkeeping and timeframes here, but if you are interested in knowing more about it, read this article on Forbes.com, where author Kelly Phillips Erb gives more detail in concise and understandable language. Essentially, though, that statute of limitations on a tax return that is correct and timely is three years after the due date. Anything clearly fraudulent, or simply not filing a return, comes with no time constraint, though, and you can always be called to task on those. Then there are some lesser crimes/mistakes that can extend the statute of limitations to six years.

So it is really up to you how long you want to hold onto your paperwork, but three years should clearly be the minimum. Holding on to the end of that six-year limit is probably an even better idea, though, and just how much space are those folders in the cabinet taking up anyway?

And at least you filed a return. The IRS released a notice on April 13 that nearly 40 million taxpayers were expected to still file returns or extensions before the deadline of the 18^th. Now I clearly was not unaware of the tendency some taxpayers have to finish things up at the last minute (and how this can involve a barrage of questions thrown at a tax professional), but that number was much higher than I would have estimated.

Now of course part of this number is due to the fact that no one really LIKES to handle their tax returns. Those of us who get some enjoyment out of all that paperwork are clearly the outliers. I also have to think, however, that a great deal of this isn’t the sole realm of the tax return, but the fact that many people only worry about their finances when situations force it, and those are rarely happy occurrences.

One of the best parts of what I do is when I see people, whether they are simply individuals or business owners, have the weight of handling their finances lifted from their shoulders. For a lot of times I find that people don’t want to ignore their finances, they often do not even know where to start to make them make sense. When one finds that way out, it can provide a lift that reinvigorates passions that were held down by worries and uncertainty.

So if you find yourself in a situation like that and it was highlighted during this tax season, you should take action now to make sure it doesn’t happen again next year. And if this is something we could help you with, for we can’t wait to move into that next part of that cycle of the financial year. 

Did you hear that? It was the giant sight of relief from those of us in the accounting profession as the tax filing deadline finally passed. Sure, that extended April 18^th deadline gave many taxpayers some extra time to file their return, but it meant tax preparers were holding our breath for a little longer than usual.

We sometimes feel like we are alone on an island during the tax season, for even when surrounded by others, our lives are run with such single-minded focus that everything on the periphery tends to fade a little bit. There was even an article on AccountingToday.com about how tax preparers relax during the season, and boy, some of that was just getting up to walk around for five minutes.

With all that being said, I hope you will allow me a little diversion with this week’s spiel, and a few less words than usual.

So to the first part of that, here is the Whose Line Is It Anyway cast bringing you Songs of Accounting – https://www.youtube.com/watch?v=XSranciXOvs.

Yeah, even professional comedians can’t help but call us boring.

Maybe in here, though, is a little bit of a lesson. Not everyone works in an occupation where government-declared deadlines forces a busy season upon you, but everyone has days that feel overwhelming. Everyone has moments when there is too much to do, not enough time to do it, and finding a way out seems impossible.

Those are the days, however, when it can be most important to take a break. Even if it is just a five-minute walk outside, or a couple laps around the office, doing something different for a few moments can be crucial to one’s sanity. And if you are sane, your work output tends to be of higher quality.

Beyond that, having a laugh (and being able to laugh at yourself) helps ease pain and stress as a general rule. And when even a boring accountant says that, it must be true.

As we hurtle toward the end of tax season, there are times when I find it difficult to still form coherent thoughts. Here’s to hoping that the rest of this makes sense then, and maybe that it even contains important information for some of you. I believe that last part is possible because it is about something that we have seen more this tax season than ever before - the growth of the sharing economy.

So yes, this includes you if you have given an Uber or Lyft ride. It probably also includes you if you used any property you owned as an Airbnb. What all these things come back to is the essential rule that if you earn money, the IRS very likely wants to know about it.

This even includes income for which you did not receive a Form 1099 or Form W2. In fact, it even includes transactions where you were paid in cash. Many believe that if there is no paper trail, there is no way the IRS could know about it, and I cannot claim that this is exactly untrue. Just remember, though, that if you are not claiming such income on a tax return, but someone else is mentioning it elsewhere, say as a deduction, that is the beginning of a paper trail of which you were unaware.

Even if you rent out some space in your home for a few weeks, but lived in it the rest of the year, there could be tax implications. Granted, these aren’t the same as having real estate that are purely investment properties that you rent out, but there still rules surrounding it.

What this sharing economy seems to add up to more than anything – at least from our view here – is many more people earning income in new ways that alters their tax picture, and often in ways they do not understand. This is certainly a situation where consulting a professional may be necessary to gain the proper peace of mind that you have submitted an accurate tax return.

This belief isn’t quite as self-serving as it may seem, though, for there are benefits for those who seek that type of assistance. You see, for just as there are different rules to be aware of when you make new types of income, there are also most likely new deductions involved. You don’t want to avoid reporting income that the IRS will want to tax you on, but you also don’t want to be paying more than your fair and legal share.

Finally, when it comes to paying taxes on this money, be aware that the IRS wants to be sure that you are paying as you go during the year. So if you are leveraging this new economy to the point where you’re making enough money to need to pay a significant amount of income tax, the IRS will expect quarterly estimated tax payments to ensure you are living up to those obligations.

I know that this can feel like there is a lot involved for something that many people run as a simple sideline business. To a certain extent this is true, but it is also an area where you want to be sure that you have the correct answers. We are confident that we can give them to you, and would be happy to discuss the situation if you have any concerns surrounding it. 

We have finally made it to April.  This may not mean much to you beyond the hopeful emergence of spring, but for those of us who work with taxes, it is when we finally (at least almost) start to crest the mountain that is tax filing season and get on the downhill side.

Granted, we still have a lot of work to do to get there, but the endpoint is in sight. This means that if you are one of the sizeable portion of the population that has been putting off filing your taxes, you better act quick if you still want an appointment before this year’s April 18 deadline.

As happens every year, we always see a rush over these final days and it is impossible for everyone who puts things off to these late dates to get their taxes finished in time. Fortunately for them, the IRS does have options to get an extension on your filing time. I wanted to take the time this week to discuss some of what that means, before it is too late.

The biggest thing to remember is that getting an extension to file does not mean you receive an extension to pay your taxes. Any taxes or penalties you may incur on an outstanding tax bill can begin to accrue on April 18 and this is regardless of whether you have received an extension or not.

Do not take this to mean that it could be better to not file your taxes, however. Yes, you may not want to know the answers that exist at the end of your tax return, but not filing it will only lead to more penalties. If your finances are not where you need them to be, you should do what you can to stop the situation from snowballing instead of avoiding it. You could try to ignore it after all, but chances are REALLY good that the IRS will not.

So if you need to file for an extension for any reason, you will also want to do what you can to make the best guess as to what your final tax bill will be and pay that on the April 18^th due date. Remember, we are talking about a bill that can be subject to interest charges, so the more you attack it before the interest starts to build, the less you are going to pay in the long run.

This means that even if you are in a position where you cannot currently pay all of the tax owed, paying as much as you can will only be a benefit in the long run. It will also be worth looking into other methods to fund paying the bill, where the charges associated with those could work out to being less than paying through the IRS. And there are also payment plans that can be set up through the IRS itself to help you eventually meet your obligations.

Overall, we understand the need for some taxpayers to get extensions on their tax returns, but when doing so it is important to have a plan for when the actual filing will occur and how to pay any bill that will exist. Again, there are options on how to best handle all of this, but the chances to figure this out before the clock runs out are dwindling.

Sometimes an article appears that says something important enough that I feel it’s worth dedicating this entire space to. When it happens during tax season, and it is not a tax issue, then it must have really done something to stand out.

So this week, I bring you an article from cfo.com - Internal Audit Losing Prestige, Survey Finds.

The title itself did not surprise me, as I have long thought there are some pieces of internal auditing that inherently make it a potentially unreliable practice. I believe it is practically impossible to get disinterested reporting through an internal audit, for even if not explicit, there are biases absorbed from the higher-ups and corporate culture in general that can affect how an internal auditor does the job.

What the article really keys on, though, is how internal audits aren’t even addressing the biggest challenges that a business faces, with two huge worries coming in the forms of regulation and cybersecurity.

With the recent fate of Republican attempts to reconfigure health care, maybe some of the worries of quick sweeping regulatory changes can ease a little bit. Just don’t let them ease too much, though, for what these issues highlight is how a business does not want to be caught unaware when disruptions occur.

All these worries are exacerbated by the pace of change in our world. The ever increasing move to digital platforms is changing the way every business operates. I daresay that is not a single industry that has not undergone significant changes over the past decade because of it. This has created some new vast areas of wealth, while leaving some companies behind when they could not adjust.

So just what can a business do if some of these old ways of doing things are no longer offering the value they once did, or maybe even are holding one back?

First, not only should you not be afraid of change, but you should embrace it. Those who thrive in emerging environments are those who looked forward, not those who only looked up when it was too late. This study was not about how businesses were not having concerns, after all, but rather that their ways of doing business were not addressing them. It is not too difficult to imagine where that could lead.

So second, do not be afraid to seek the help you need to move with the times. New regulations can certainly affect a business, but the organizations that survive are the ones who paid attention to when they were coming, and established a plan to deal with them prior to being enacted. And companies who don’t pay attention to cybersecurity until they have an issue with cybersecurity begin their fight from a losing position, a position that could have already damaged your customers’ trust.

You may not be a business that has ever done any exceptional sort of internal auditing, so the article that started this all off may not specifically speak to you, but these are lessons that everyone can learn from, even on an individual level. If you have worries or if you see potential future issues and the things you are doing are not addressing them, change what you’re doing. It may not be easy, and it may be something you need outside help to do, but that doesn’t mean it is not worth doing.