Outsourced Bookkeeping Services
Bookkeeping is not a priority for many small businesses. Few business owners get thrilled at the idea of sitting in front of a computer and processing. However, ensuring that your business complies with the latest IRS rules is a tedious, full-time job.
Many business owners would not consider engaging in bookkeeping and accounting services if the IRS were lax. Unfortunately, the federal agency is anything but lenient.
In 2016, the IRS audited 1.2 million tax returns. Only 37,000 examinations resulted in additional refunds to the taxpayer; 99.7 percent of the time, the firms audited by the IRS did not receive any monetary benefit. Do not appear on the IRS’ audit radar if you are a small to the midsize business owner. You will lose money and dozens of hours complying with the auditors.
What Triggers the IRS to Investigate Your Business?
Although the criteria the IRS uses to launch an investigation into a business’s operations is a closely guarded secret, your accounting firm can tell you about some common triggers:
Discrepancies in financial statements and incorrect tax filing:
Usually happens when you decide to become your accountant, instead of hiring engaging professionals for bookkeeping services
Reporting a net loss in more than two of the last five years
Unreasonably high salaries:
Especially, if the beneficiaries are shareholders who also happen to be employees
There is only so much you can deduct for meals, travel, and entertainment
Significant charitable contributions can alert the IRA, and you may be investigated for tax abuse
High income or assets:
The probability of an audit goes up.
An accounting services firm can protect you from an IRS audit, but that should not be the only reason to invest in bookkeeping services. Your business can profit immensely from a professional consultation.
Cheapest Road to Professional Bookkeeping Services
Many small to midsize businesses can choose any of these four methods to maintain their books:
- Be your accountant
- Hire a family member to stay on top of the finances
- Hire an in-house accountant
- Hire an outsourced professional firm
Methods 1 and 2 are cost-effective in the short run, but you will run a risk in the long term. Keeping it in the family without professional supervision increases the chances of a discrepancy creeping in and the IRS slapping you with a penalty.
In-house bookkeepers can protect your firm from audits, reduce your stress, and improve your financial decisions. You can save a lot in tax savings. Almost all large firms have in-house bookkeepers on their payroll. Often, small to midsize businesses cannot afford the services of an in-house accountant.
That leaves us with professional outsourced bookkeeping services without the expense of an in-house accountant.
In the absence of an in-house accountant, an outsourced accounting firm is the best way to go. Not only will you receive professional guidance, but it will be at a fraction of what a full-time accountant would cost.
CFO Strategies to the Rescue
For many years, we have provided on-demand bookkeeping, controller, and CFO services to New Jersey and New York businesses. Hire us for:
Call us at (855) 732-7861 and talk to our team of CPAs and senior professionals. Best of all, we work on-site at your place of business.