By Natalie Hopkins With the blink of an eye, we will be turning the page on yet another calendar year. For anyone involved in owning or managing a business, there is a whole new list of tasks to complete. Below are some of the most important business reminders as we close out 2014 and welcome 2015.
1099s: 1099s are required to be filed for any non-corporate vendor that renders service fees in excess of $600 for the year. The deadline for sending 1099s to recipients is February 2, 2015 while the deadline for filing the 1099s and 1096s to the internal revenue service is March 2, 2015.
W2s and year-end payroll reporting: Many companies use an outside payroll provider for ongoing payroll tax filing needs. There are several items that business owners should keep in mind. The first is self-employed health insurance. If you own an S Corporation, you are required to adjust your W2 compensation to include your health insurance (though this is deducted on your individual tax return). Second, if your business provides a car to you or your employees, you must report the personal use of that vehicle on the W2.
Tax Planning: The end of the year is an appropriate time to reach out to your tax professional for assessing your estimated tax liabilities that will be due to Uncle Sam when April 15th rolls around. Your tax professional can suggest strategies to limit your taxable income. For instance, the timing of your retirement contributions or distributions can trigger tax effects that can hurt or help you. With ever-changing tax codes and regulations, there are significant areas where additional guidance would benefit your business and personal tax position.
Audit, Accounting and Compliance: Depending on your banking requirements or overall compliance needs, it’s important to have a plan for closing out your year-end financial statements. This may include an audit, review or compilation performed by an independent certified public accountant. Banking needs are constantly changing, so this may be a necessary step as you plan ahead, especially if you anticipate any potential financing needs.
Some financial areas receive more focus at year-end. For example, when is the last time a physical inventory was taken at your facility? Have your fixed asset listings been evaluated recently ensuring what’s in your financial statements matches what’s physically at your location? This can be important for annual property tax filings.
Budgeting: While there are plenty of items to consider for closing out 2014, this offers a springboard to 2015 budgeting. Preparing an annual budget is a critical component to understanding your Company’s needs and how that translates into positive cash flow. As CPAs, we prepare projection models showing monthly balance sheets, income statements and cash flow statements, so owners understand the entire financial picture.
Being proactive in closing out the year-end financials is a critical component to managing a business and preparing it for a lengthy and prosperous future. Call your Alerding CPA Group advisor for your end-of-year needs at 317-569-4181 or visit our website: www.alerdingcpagroup.com. Alerding CPA Group is an Indianapolis-based public accounting firm.
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Natalie Hopkins, CPA
Natalie services audit and assurance clientele with their annual compliance needs and general consulting services. Her client base includes wholesale/distribution, manufacturing, retail, service organizations, and health and welfare organizations. Natalie was chosen as an “Emerging Leader” by the Indiana CPA Society.
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