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At a certain point, it’s common for startups and small business owners to reach a point where basic bookkeeping isn’t enough, but they’re still not ready for a full-time Chief Financial Officer. If this sounds familiar, a Fractional CFO might be just what your business needs.

What is a Fractional CFO?

Think of a Fractional CFO as a high-level financial strategist who works with your company part-time. While your bookkeeper handles daily transactions and your controller manages accounting operations, a Fractional CFO takes a broader view. They’re the strategic partner who helps make those big-picture financial decisions that drive growth.

How a Fractional CFO drives business growth

Strategic planning and analysis

Your Fractional CFO will dig deep into your financial data to spot trends and opportunities you might miss. They’re like a financial detective, identifying potential issues before they become problems and turning complex data into actionable recommendations that align with your goals.

Systems and process optimization

Growing businesses need scalable systems. Your Fractional CFO can help choose the right financial software, set up proper controls, and create efficient reporting procedures that grow with your business.

Team development

A good Fractional CFO doesn’t just work alone — they help your existing finance team level up their skills. This investment in your team’s capabilities pays dividends long after the CFO’s engagement ends.

Cash flow management

Through careful forecasting and analysis, your Fractional CFO helps ensure you have the cash you need, when you need it. They’ll help optimize your working capital and improve collections so you never miss a growth opportunity due to cash flow constraints.

Expert guidance for major transactions

When it’s time for big moves like mergers, acquisitions, or raising capital, your Fractional CFO becomes invaluable. They can:

• Guide you through complex term sheet negotiations.

• Manage the due diligence process.

• Connect you with potential investors or buyers.

• Communicate effectively with your board and stakeholders.

• Review and structure complex contracts.

Benefits of the fractional model

Cost-effective expertise

Hiring a full-time CFO is expensive, often costing $350,000 or more annually plus benefits. A Fractional CFO gives you senior-level expertise at a fraction of that cost, charging only for the time you actually need.

Flexibility and scalability

Your business needs change throughout the year. A Fractional CFO arrangement lets you scale their involvement up or down as needed, making it perfect for growing companies or those facing temporary challenges.

Broad experience

Fractional CFOs bring experience from multiple industries and companies. They’ve likely solved problems similar to yours before and can bring fresh perspectives to your challenges.

Signs your business might need a Fractional CFO

You might want to consider a Fractional CFO if your business is:

• Growing so fast your financial systems can’t keep up.

• Struggling to understand your cash flow patterns.

• Needing sophisticated financial modeling and forecasting.

• Preparing for a major transaction or capital raise.

• Missing clear financial metrics and KPIs.

At Archer Lewis, we understand that every growing business reaches a point where basic accounting isn’t enough anymore. Our Fractional CFO services help bridge that gap, providing the strategic financial leadership you need to reach your goals — without the full-time cost.  Learn how we can help your business reach its full potential.

As more and more baby boomer business owners get ready to retire, a big question looms: What’s next for their businesses? The U.S. Census Bureau tells us that over 12 million small businesses are run by people aged 55 or older, meaning a massive wave of transitions is coming. Surprisingly, though, fewer than 30% of these owners have a formal succession plan in place. So, let’s dig into why small business succession planning is essential to protect the future of your business — and how you can build a plan that works.

What is succession planning?

At its core, a succession plan is a roadmap. It lays out how ownership and leadership will pass on when an owner steps down. With this plan in place, you create continuity, protect your business’s value, and ensure your legacy lasts. Without a plan, businesses often face rough transitions, and some even fail entirely.

Why start succession planning now?

Early succession planning offers some key advantages:

• Tax Optimization: With the right structure, you can minimize taxes for you and your successors

• Higher Valuation: A solid succession plan can actually increase your business’s market value.

• Smooth Transitions: Employees, customers, and vendors experience fewer disruptions.

• Stronger Relationships: Keeping things fair and transparent can help maintain stable partnerships.

• Financial Security: The right exit plan can provide you with the retirement funds you need.

Common ways to plan for succession

There’s no one-size-fits-all approach to succession planning. Here’s a look at some common paths owners take:

Family succession

Passing a business on to family is still a common choice for many owners. But it comes with unique challenges — like balancing family dynamics and making sure your chosen successor has the leadership chops to take over. Success in this path often depends on grooming future leaders early and keeping other family members in the loop.

Internal sale

Selling to key employees can be a great way to reward loyalty and keep your company’s culture intact. This often involves Employee Stock Ownership Plans (ESOPs) or other gradual transitions that can spread out the financial burden. It does, however, require careful planning to arrange the right financing.

External sale

For some owners, an outside sale—whether to a competitor, an investor, or an entrepreneur—is the best way to go. External sales can yield higher sale prices but involve thorough preparation to attract the right buyers and negotiate favorable terms.

Leadership development

Instead of focusing on an outright sale, some owners prepare by identifying and training future leaders to manage day-to-day operations. This approach works well when combined with other strategies, ensuring continuity in both ownership and management.

Emergency succession

Life can throw curveballs, so every business should have a contingency plan for unexpected events like illness or death. A basic emergency plan will outline immediate leadership responsibilities and the steps for a longer-term transition.

Hybrid approaches

Some businesses blend these approaches, such as selling part of the business to employees while training a family member to take on a leadership role. Hybrid plans can be tailored to fit unique needs, preserving both company culture and family involvement.

Mistakes to avoid in succession planning

It’s easy to put succession planning on the back burner, but these common pitfalls can cause big headaches down the line:

Starting too late

Many owners don’t start planning until they’re nearing retirement, but successful transitions often need three to five years of prep time.

Overvaluing the business

Emotional attachments can cloud judgment, leading some owners to set unrealistic sale prices. Professional valuations can help ground these expectations.

Lack of successor preparation

Transition plans falter when successors aren’t fully prepared for the job. Investing time in training your successor can prevent future issues.

Poor communication

Clear communication with family, employees, and stakeholders is crucial. Leaving people in the dark often breeds uncertainty and resistance to change.

Insufficient documentation

If processes, client relationships, and intellectual property aren’t well documented, it’s much harder to maintain value during a transition.

Tax missteps

Without careful tax planning, you could face unexpected taxes that drain your retirement funds. Talk to a tax advisor to make sure you’re protected.

When to bring in the pros

Succession planning can get complicated. Here’s when it’s a good idea to seek help from professionals:

• The business is your main retirement asset.

• Family dynamics make succession choices tough.

• Your business is worth over $1 million.

• You’re unsure about tax implications.

• You’re aiming for a quick timeline (less than five years).

Remember, succession planning isn’t just about retirement—it’s about securing the future of the business you worked so hard to build. The earlier you start, the more options you have to meet your goals and preserve your legacy.

At Archer Lewis, we specialize in guiding small business owners through these pivotal transitions. Our team can help you maximize value, minimize tax impacts, and create a plan that preserves both your wealth and your relationships. Together, we’ll make sure your business is ready for its next chapter.

Learn how we can help you with succession planning.

Remote work has changed the game for small businesses. While you can now hire that perfect data analyst from Oregon or the stellar developer from Florida, managing taxes for out-of-state employees can feel like solving a Rubik’s cube blindfolded. But it’s not impossible, let’s break down tax implications for remote workers into bite-sized pieces you can actually use.

Key tax considerations for remote workers

When employees work remotely from different states, you face a web of tax requirements that vary by location. For example, if your business calls Texas home but employs people in California and New York, you’ll need to play by each state’s rulebook.

State-specific tax requirements

Here’s where things get interesting. Like real estate, state taxes are all about location, location, location — but not yours, your employees’. Here’s what you need to know:

• State tax withholding follows your employees home — literally. You’ll typically need to withhold taxes for the state where they’re working from.

• Some states play nice with each other through “reciprocal agreements,” meaning employees only pay taxes in their home state.

• Thanks to COVID-19, some states created special rules about remote work that might still apply.

Remember, you might need to:

• Introduce yourself to state tax agencies by registering your business.

• Open state tax accounts.

• File tax returns in several states.

• Keep track of different tax rates (they’re all over the map, literally).

• Stay on top of ever-changing rules.

Federal tax obligations remain consistent

State compliance can be a pain, but federal taxes don’t care where your employees work. Still, you’ll need to:

• Withhold employees’ federal income tax.

• Pay your share of Social Security and Medicare.

• Collect employees’ portion of these taxes.

• File quarterly federal returns.

• Send out W-2s every January.

• Keep your paperwork in shape.

Business registration requirements

Remote workers mean you also might need to deal with “foreign qualification,” which has nothing to do with international business — it’s what happens when you need to register your business in other states. You might need this when:

• The company has a physical presence (including home offices).

• You sell a certain amount in that state

• You pay people who live in that state.

• Regular business meetings occur in the state.

When to seek professional guidance

As much as we support and admire the DIY spirit, there are times when calling in the pros just makes more sense. Consider getting help when:

• You’re hiring your first out-of-state remote worker.

• You’re expanding into new states.

• You’re dealing with complicated multi-state situations.

• You’re scratching your head over registration requirements.

• State tax authorities are coming after you.

• Your remote team is growing fast.

While managing these obligations might seem overwhelming, you don’t have to figure it out alone. Our team keeps tabs on tax rules across all 50 states (so you don’t have to), and we’re here to help you stay compliant while keeping more of your hard-earned money in your pocket.

Learn how we can help keep your business tax-compliant.

Small business owners know there’s nothing like a letter from the IRS to ruin your day. As tax professionals who work with small business owners every day, we often meet entrepreneurs who could have avoided costly penalties if they’d known what to watch out for. Here’s a guide to the most common IRS penalties and, more importantly, how to keep your business penalty-free.

1. Failure to file penalty

What is it: Missing your tax return deadline will cost you. The IRS charges 5% of your unpaid taxes for each month your return is late (up to 25%). If you’re more than 60 days late, you’ll pay at least $435 or 100% of the unpaid tax, whichever is smaller.

How it happens: This one’s simple – the IRS automatically flags your account when they don’t receive your return by the deadline.

How to avoid it:

• Need more time? File for an extension — but remember, an extensions only gives you more time to file, not to pay.

• Even if you can’t pay, always file on time.

• Work with a tax professional to stay organized and on top of your filing deadlines.

2. Failure to pay penalty

What it is: Filed on time but can’t pay the full amount? The IRS charges 0.5% of your unpaid taxes each month (up to 25%) until you pay. Plus, interest keeps accruing until you pay.

How it happens: The IRS will penalize you when you don’t pay the full amount due with your return.

How to avoid it:

• Set aside money throughout the year for taxes.

• If you can’t pay the full amount, pay as much as you can and consider an installment agreement.

3. Accuracy-Related Penalty

What it is: Making significant mistakes on your taxes — like underreporting income or claiming deductions you shouldn’t — can cost you an extra 20% on top of the underpaid tax.

How it happens: The IRS typically uncovers these mistakes during an audit.

How to avoid it:

• Keep detailed records all year long — your future self will thank you.

• Use bookkeeping software or work with a professional bookkeeper to stay on top of your taxes.

4. Payroll tax penalties

What it is: If you have employees, you need to regularly deposit their withheld income tax, Social Security, and Medicare taxes. Miss these deposits or pay late, and you’re looking at penalties from 2% to 15% of the unpaid amount.

How it happens: The IRS tracks payroll tax deposits closely, so they quickly notice when they’re late or missing.

How to avoid it:

• Use a reliable payroll system.

• Set up automated electronic payments for payroll taxes.

• Know your deposit schedule and stick to it.

5. Estimated Tax Penalty

What it is: I Expecting to owe $1,000 or more in taxes? You’ll need to make quarterly estimated tax payments. Skip these, and you’ll face a penalty based on how much you underpaid and for how long.

How it happens: If you didn’t notice this throughout the year, the IRS will catch it when you file your annual return. Missing deadlines or underpaying can also trigger a penalty

How to avoid it:

• Accurately calculate your estimated taxes using IRS Form 1040-ES.

• Adjust your withholding if you also have W-2 income.

• Pay your quarterly estimated taxes on time.

• Adjust payments throughout the year if your income goes up and down.

How the IRS detects penalties

The IRS has a few says to identify when penalties should be applied:

1. Automated systems that flag late or missing returns and payments

2. Cross-checking information returns (like 1099s) against your tax return

3. Audits, both random and targeted

4. Tips from various sources

What to do if you get hit with a penalty

If you receive a penalty notice, don’t panic. There are steps you can take:

1. First-time penalty relief: If this is your first penalty, you might qualify for the IRS’s First-Time Penalty Abatement program. To be eligible, you must have filed and paid all required taxes in the previous three years.

2. Show reasonable cause: Believe it or not, the IRS understands that stuff happens — natural disasters, serious illness, or bad professional advice might get your penalty waived. Just be ready to prove your case.

3. Check their math: Sometimes, the IRS makes mistakes. Double-check IRS calculations against your records.

4. Offer in compromise: If you can demonstrate financial hardship, you may be able to settle your tax debt for less than the full amount.

5. Installment agreement: If you can’t pay all at once, you can set up a payment plan with the IRS to avoid more penalties.

The bottom line? Stay organized and deal with problems as soon as they happen. Set reminders for important tax dates, keep good records, and reach out for help when you need it. Understanding these common pitfalls now can save you serious money — and stress — later.

Need help with your tax situation? That’s what we’re here for at Archer Lewis. We can help you navigate the tax maze and keep your business penalty-free, so you can focus on what really matters — growing your business. Learn more.

As a small business owner, navigating the complexities of the tax system can be daunting. Mistakes can lead to costly penalties and unnecessary stress. Below we highlight five common tax mistakes small businesses make and provide practical tips on how to avoid them.

1. Misclassifying Employees as Independent Contractors

Many small businesses misclassify employees as independent contractors to save on payroll taxes and benefits. However, the IRS has strict guidelines to determine worker classification, and misclassifications can result in fines.

How to Avoid This:

• Understand the IRS criteria for classification.

• Use IRS Form SS-8 to determine a worker’s status if unsure.

• Consult with a tax expert to ensure proper classification and avoid potential penalties.

2. Failing to Keep Accurate Records

The Mistake: Inadequate record-keeping can lead to missed deductions, inaccurate tax returns, and difficulties during audits.

How to Avoid This:

• Implement a reliable accounting system to track income and expenses.

• Regularly update your financial records.

• Store receipts and documents electronically for easy access.

• Evaluate a bookkeeping service to help you maintain accurate records year-round.

3. Missing Out on Tax Deductions

The Mistake: Small businesses often overlook eligible tax deductions, such as home office expenses, vehicle expenses, and business-related travel.

How to Avoid This:

• Educate yourself on common deductions for small businesses.

• Keep detailed records and receipts for all business expenses.

• Use accounting software to categorize expenses correctly.

• Work with a knowledgeable accountant to identify and claim all possible deductions.

4. Ignoring Quarterly Estimated Tax Payments

The Mistake: Many small businesses fail to make quarterly estimated tax payments, leading to underpayment penalties and interest charges.

How to Avoid This:

• Estimate your annual tax liability and divide it into four quarterly payments.

• Set reminders for due dates: April 15, June 15, September 15, and January 15.

• Use IRS Form 1040-ES for guidance.

• Your accountant can assist you in calculating your estimated taxes and setting up a payment schedule.

5. Not Staying Updated on Tax Law Changes

The Mistake: Tax laws change frequently, and small businesses often miss updates that could impact their tax filings and liabilities.

How to Avoid This:

• Subscribe to IRS newsletters or follow their updates online.

• Attend tax seminars and webinars relevant to your industry.

• Consult with a tax professional who stays abreast of the latest tax regulations and can assist you in ensuring compliance.

Conclusion

Avoiding these common tax mistakes can save your small business time, money, and stress. At Archer Lewis, we’re committed to helping small businesses thrive by providing expert tax services and personalized advice. Learn how we can support your business’ financial health and compliance.

Monitoring your financial health is crucial for the success and growth of your small business. By keeping track of essential financial reports, you can make informed decisions, manage cash flow, and ensure long-term sustainability.

Here are the key small business financial reports you should monitor.

1. Income Statement (Profit and Loss Statement)

Why It Matters: The income statement provides a summary of your business’ revenues, expenses, and profits over a specific period. It helps you understand your profitability and identify areas for cost reduction.

Key Components:

Revenues: Total income from sales and other sources.

Expenses: Costs incurred in generating revenue.

Net Income: The difference between revenues and expenses.

Tip: Review your income statement monthly to track performance trends and make timely adjustments.

2. Balance Sheet

Why It Matters: The balance sheet gives a snapshot of your business’ financial position at a specific point in time. It shows what you own (assets), what you owe (liabilities), and your equity.

Key Components:

Assets: Cash, inventory, property, and receivables.

Liabilities: Loans, accounts payable, and other debts.

Equity: Owner’s equity and retained earnings.

Tip: Monitor your balance sheet quarterly to ensure your business maintains a healthy financial position and to identify potential liquidity issues.

3. Cash Flow Statement

Why It Matters: The cash flow statement tracks the flow of cash in and out of your business, highlighting your liquidity and financial stability. It helps you understand how well your business generates cash to meet its debt obligations and fund operating expenses.

Key Components:

Operating Activities: Cash generated from core business operations.

Investing Activities: Cash used for investments in assets and other businesses.

Financing Activities: Cash flows from borrowing and repaying loans.

Tip: Regularly review your cash flow statement to manage your working capital effectively and avoid cash shortages.

4. Accounts Receivable Aging Report

Why It Matters: This report shows the status of outstanding invoices and helps you manage your credit policies and collections. It highlights which customers owe you money and how long the invoices have been outstanding.

Key Components:

• List of customers with outstanding balances.

• Aging categories (e.g., 0-30 days, 31-60 days, 61-90 days, over 90 days).

• Total receivables within each category.

Tip: Use this report to follow up on overdue accounts and improve your cash flow management.

5. Accounts Payable Aging Report

Why It Matters: The accounts payable aging report helps you track outstanding bills and manage your business’s obligations to suppliers. It shows what you owe and when payments are due.

Key Components:

• List of suppliers with outstanding bills.

• Aging categories (e.g., 0-30 days, 31-60 days, 61-90 days, over 90 days).

• Total payables within each category.

Tip: Review this report regularly to ensure timely payments and maintain good supplier relationships.

6. Budget vs. Actual Report

Why It Matters: This report compares your actual financial performance against your budgeted figures. It helps you assess how well your business is performing relative to your financial plans and identify areas for improvement.

Key Components:

• Budgeted revenues and expenses.

• Actual revenues and expenses.

• Variances between budgeted and actual figures.

Tip: Analyze this report monthly to adjust your budget and improve financial planning.

7. Break-Even Analysis

Why It Matters: A break-even analysis helps you determine the sales volume needed to cover your costs. It’s crucial for pricing strategies and understanding the impact of changes in sales volume on profitability.

Key Components:

Fixed Costs: Costs that do not change with sales volume.

Variable Costs: Costs that vary with sales volume.

Break-Even Point: The sales volume at which total revenues equal total costs.

Tip: Perform a break-even analysis before launching new products or services to set realistic sales targets.

Enhance Your Financial Monitoring with Archer Lewis

Regularly monitoring these essential financial reports can provide valuable insights into your business’s financial health, enabling you to make informed decisions and achieve long-term success. At Archer Lewis, we offer expert accounting services to help businesses stay on top of their finances and grow confidently.

Stay ahead of your financial health with Archer Lewis (AL). Our expert accountants can help you manage your essential financial reports and provide personalized advice to ensure your business’s success. Discover how we can support your financial management needs.

As a small business owner, managing your accounting needs effectively is crucial for maintaining financial health and supporting growth. One of the key decisions you’ll face is whether to handle accounting in-house or outsource it to an external provider. Both options have their advantages and disadvantages. Here, we compare in-house accounting vs outsourcing to help you determine the best fit for your business.

In-House Accounting

Pros:

Direct Control:

Having an in-house accountant gives you direct control over your financial processes and ensures that the accounting function is closely aligned with your business goals.

Immediate Access:

In-house accountants are readily available to address any financial issues or queries as they arise, facilitating quick decision-making and problem-solving.

Tailored Solutions:

An in-house accountant can develop customized financial strategies and processes that are specifically tailored to your business needs.

Enhanced Collaboration:

Being part of your team, an in-house accountant can collaborate more effectively with other departments, fostering a more integrated approach to business management.

Cons:

Higher Costs:

Hiring an in-house accountant involves significant costs, including salary, benefits, training, and overhead. This can be a considerable financial burden for small businesses.

Limited Expertise:

An in-house accountant may not have the same breadth of knowledge and experience as a team of external professionals, potentially limiting the scope of advice and services you receive.

Recruitment and Retention Challenges:

Finding and retaining qualified accounting professionals can be challenging and time-consuming. Turnover can disrupt your business operations and lead to additional recruitment costs.

Technology Investment:

Maintaining up-to-date accounting software and technology in-house requires ongoing investment and management, which can strain your resources.

Outsourcing Accounting Services

Pros:

Cost Savings:

Outsourcing can be more cost-effective than hiring a full-time, in-house accountant, especially for smaller businesses. You avoid expenses related to salaries, benefits, and training.

Access to Expertise:

External accounting firms employ professionals with diverse experience and specialized knowledge. This ensures you receive high-quality service and up-to-date advice on the latest tax laws and financial regulations.

Scalability:

Outsourcing allows you to easily scale services up or down based on your business needs. This flexibility is particularly beneficial for businesses experiencing growth or seasonal fluctuations.

Focus on Core Business Activities:

By outsourcing accounting tasks, you free up time and resources to concentrate on your core business activities, improving overall productivity and efficiency.

Advanced Technology:

Outsourced accounting firms often use the latest technology and software, providing you with accurate and timely financial reports without the need for significant investment in IT infrastructure.

Cons:

Less Control:

Outsourcing means relinquishing some control over your accounting processes, which can be a concern for business owners who prefer hands-on management.

Communication Challenges:

Working with an external provider can sometimes lead to communication gaps, especially if the firm is not local. Clear and regular communication is essential to avoid misunderstandings.

Security Risks:

Sharing sensitive financial information with an external provider carries some security risks. It’s important to choose a reputable firm with strong data protection measures.

Conclusion

Deciding between outsourcing and in-house accounting depends on your business’s specific needs, resources, and growth plans. Outsourcing offers cost savings, access to expertise, and scalability, making it an attractive option for many small businesses. In contrast, in-house accounting provides direct control, immediate access, and tailored solutions but comes with higher costs and recruitment challenges.

Choosing the right accounting solution is crucial for your business’s financial health. Let our experts help you navigate this decision and provide the support you need to thrive. Discover how we can enhance your accounting processes.

Choosing the right Certified Public Accountant (CPA) is a crucial decision for any business. The right CPA can provide valuable financial advice, ensure compliance with tax regulations, and help your business grow.

Here’s how to choose an accountant for your small business and key considerations to keep in mind during the process.

1. Qualifications and Experience

Why It Matters: A CPA with the right qualifications and experience can offer expert guidance and support tailored to your business needs.

What to Look For:

• Ensure the CPA is licensed and has the necessary credentials.

• Look for CPAs with experience in your industry.

• Check their track record with businesses of similar size and structure to yours.

Tip: Ask for client references to get insights into the CPA’s performance and reliability.

2. Range of Services

Why It Matters: Your business may need various accounting services, from tax preparation to financial planning. A CPA who offers a broad range of services can be a valuable asset.

What to Look For:

• Tax preparation and planning

• Bookkeeping and payroll services

• Financial reporting and analysis

• Business advisory services

Tip: Choose a CPA who can scale their services as your business grows, ensuring you have the support you need at every stage.

3. Industry Knowledge

Why It Matters: A CPA familiar with your industry’s specific challenges and regulations can provide more relevant and effective advice.

What to Look For:

• Experience with industry-specific tax codes and regulations

• Understanding of common financial challenges in your sector

• Ability to provide tailored financial strategies

Tip: Discuss industry-specific issues during your initial consultation to gauge the CPA’s knowledge and expertise.

4. Communication and Availability

Why It Matters: Effective communication and accessibility are vital for a productive working relationship with your CPA.

What to Look For:

• Responsiveness to calls and emails

• Availability for regular meetings and consultations

• Clear and concise communication style

Tip: Choose a CPA who is proactive in providing updates and information, ensuring you are always informed about your financial status.

5. Technology and Tools

Why It Matters: Modern accounting software and tools can streamline processes and enhance accuracy. A tech-savvy CPA can provide more efficient and timely services.

What to Look For:

• Use of up-to-date accounting software

• Secure online portals for document sharing

• Familiarity with cloud-based accounting solutions

Tip: Ask about the CPA’s technology stack and how they use it to improve service delivery and client communication.

6. Cost and Fees

Why It Matters: Understanding the cost structure of CPA services helps you budget appropriately and avoid unexpected expenses.

What to Look For:

• Transparent fee structure

• Clarity on what services are included in the fees

• Comparison with industry standards

Tip: Opt for a CPA who offers value for money rather than the cheapest option, ensuring you receive quality services.

7. Reputation and Reviews

Why It Matters: A CPA’s reputation can provide valuable insights into their reliability and service quality.

What to Look For:

• Online reviews and testimonials

• Ratings on professional directories

• Awards and recognitions in the accounting industry

Tip: Conduct thorough research online and ask for recommendations from trusted business associates.

Optimize Your Financial Management with Archer Lewis

Picking the right CPA is essential for the financial health and success of your business. By considering qualifications, range of services, industry knowledge, communication, technology, cost, and reputation, you can make an informed choice that meets your business needs.

At Archer Lewis, we pride ourselves on providing comprehensive and tailored accounting services to help our customers’ businesses thrive. Discover how we can enhance your financial management.

Understanding and utilizing available tax deductions for small businesses can significantly reduce your tax burden and maximize your profits. Here are some common tax deductions that your small business should consider to save money.

1. Home Office Deduction

If you use part of your home exclusively for business purposes, you may qualify for a home office deduction. This can include a portion of your mortgage interest, rent, utilities, insurance, and repairs.

How to Qualify:

• The space must be used regularly and exclusively for business.

• It must be your principal place of business.

Tip: You can use the simplified option to calculate your deduction: $5 per square foot of your home used for business, up to 300 square feet.

2. Business Vehicle Expenses

If you use a vehicle for business purposes, you can deduct related expenses. There are two methods to calculate this deduction: the standard mileage rate or actual expenses.

Standard Mileage Rate:

Multiply the number of business miles driven by the IRS standard mileage rate (65.5 cents per mile for 2023).

Actual Expenses:

Deduct the actual costs of operating the vehicle, such as gas, oil, repairs, insurance, and depreciation.

Tip: Keep detailed records of your business mileage and vehicle expenses to substantiate your deduction.

3. Supplies and Equipment

Expenses for office supplies, software, and equipment used for your business can be fully deducted. This includes items like computers, printers, and office furniture.

How to Qualify:

The items must be necessary and used for your business.

Keep receipts and records of all purchases.

Tip: For larger equipment purchases, consider Section 179 deduction to write off the entire cost in the year of purchase rather than depreciating over several years.

4. Travel Expenses

Business travel expenses are deductible if the travel is necessary for your business. This includes transportation, lodging, meals, and incidental expenses.

How to Qualify:

The trip must be primarily for business purposes.

Maintain records of the business purpose of each trip.

Tip: Only 50% of meal expenses can be deducted, so keep separate records for meals and other travel expenses.

5. Professional Services

Fees paid to professionals such as accountants, lawyers, and consultants are deductible. These services must be directly related to your business.

How to Qualify:

The services must be necessary for the operation of your business.

Keep invoices and payment records for these services.

Tip: Regularly consult with a CPA to ensure you’re taking full advantage of all available deductions.

6. Employee Salaries and Benefits

Wages, salaries, and employee benefits are fully deductible as long as they are reasonable and paid for services actually rendered.

How to Qualify:

Payments must be for actual work performed.

Maintain detailed payroll records.

Tip: Consider offering benefits like retirement plans and health insurance, which are also deductible and can help attract and retain employees.

7. Advertising and Marketing

Expenses related to advertising and marketing your business, such as website costs, business cards, and online advertising, are deductible.

How to Qualify:

Expenses must be directly related to promoting your business.

Keep receipts and records of all marketing expenditures.

Tip: Invest in a mix of marketing strategies to maximize your reach and effectiveness.

Maximize Your Tax Deductions with Archer Lewis

Taking advantage of these common tax deductions can help reduce your tax liability and increase your bottom line. At Archer Lewis, we’re committed to helping small businesses thrive by providing expert tax services and personalized advice. Contact us today to learn how we can support your business’s financial health and compliance.

Don’t let tax season overwhelm you. Let Archer Lewis (AL) help you navigate the complexities of business taxes and ensure you’re taking full advantage of all available deductions. Discover how we can make tax time easier and more profitable for your business.

A 529 plan is a tax-advantaged savings plan designed to help individuals save for future education expenses. These expenses can include tuition, room and board, books, and other educational fees. The importance of a 529 plan lies in its ability to provide a structured and efficient way to save for education costs.

One key benefit of a 529 plan is its tax advantages. Earnings within the plan grow tax-deferred, meaning that account holders do not pay taxes on investment gains each year. Additionally, withdrawals used for qualified education expenses are tax-free at the federal level, making it a valuable tool to save for education without incurring unnecessary tax liabilities.

Another crucial aspect of a 529 plan is its flexibility. The funds saved in a 529 plan can be used at eligible educational institutions across the country, including colleges, universities, vocational schools, and even some international institutions. This flexibility allows account holders to use the savings for a wide range of educational pursuits, providing options for both traditional and non-traditional educational paths.

Furthermore, a 529 plan can be a practical way to involve family members in contributing to a child’s education fund. Grandparents, relatives, and friends can contribute to the plan, helping to build a substantial sum over time. This collaborative approach to saving can ease the financial burden of education expenses for both the account holder and the student.

In conclusion, a 529 plan is a valuable tool for saving for education expenses due to its tax advantages, flexibility, and collaborative savings approach. By utilizing a 529 plan, individuals can effectively save for educational goals and ensure that they or their loved ones have the financial resources needed to pursue higher education opportunities. Learn how we can help you with your taxes.