California Business Tax Services
Accounting puts a business owner in control of growth by providing the business owner and others responsible for the development of the company with a guide to the business’s financial past, present and future. An experienced accountant or bookkeeper records and accounts for all transactions that may occur within your business. Hiring an experienced bookkeeper or accountant can allow a small- or mid-sized business to focus their resources on developing the core business.
Keep Track of Your Company’s Financial Health Financing
Working with an accountant or bookkeeper gives a business owner and other responsible parties the peace of mind by having a breakdown of the business’s short-run and longer-run finances. This break-down of financial data can help a business owner to understand whether the business plan is functioning as anticipated. Such data can provide information about the margins the business is currently working with and whether a price increase or decrease could improve the position of the commercial venture.
Furthermore, when the time does come to expand the business or to make other capital expenditures, your business will likely need a loan or some other form of credit. Few, if any, banks or financial institutions are willing to extend a loan without having an understanding of a company’s finances and prospects for future years. Banks will typically request to see statements, cash flow analyses, and other financial data before making a loan. The more favorable financial position a company can show, the more favorable the terms of the loan.
Protect Your Company from Tax Compliance Issues
Businesses are required to meet an array of tax compliance options. Two obligations that nearly all businesses will have to account for, collect and hold, and turn-over to the government are payroll taxes and sales taxes. Payroll taxes are assessed at both the state and federal level by the California Employment Development Division (EDD) and the IRS, respectively. The sales tax obligation is state-based in nature and is administered and enforced by the California Board of Equalization (BOE).
While many business owners believe that they will not be noticed by the tax authorities because they are only “one company in a sea of businesses”, this assumption is misguided and is likely to land the company in a difficult tax situation. The California BOE routinely engages in sales tax audits and will engage in a number of tests and other methods – such as a pour test in the case of a bar – to ensure that the information about sales reported by the business is complete and accurate. The IRS and California EDD also conduct regular audits to encourage business owners to voluntarily comply with their tax obligations.
The violation of either of these obligations can result in being made to pay back the tax amounts due and owing and the imposition of significant additional fines, penalties, and interest. In the case of unpaid employment taxes, if the violation is willful, the unpaid business taxes can be imposed against the personal finances of the company owner or any other responsible parties. If the violation is a sales tax violation due to the use of a zapper or another device that surreptitiously edits sales records, the business owner is likely to face California criminal penalties along with a tax consequences. For many businesses such a penalty would be fatal to continuing operations.
Efficient and Cost-Effective Bookkeeping for California Businesses
Having inaccurate books is like trying to helm a ship without a rudder. At the Tax law Offices of David W. Klasing we provide an array of accounting and bookkeeping services for businesses in and around Los Angeles. Our firm’s accounting and bookkeeping services include:
- Tracking and analysis of accounts payable and receivable
- Financial statement preparation (Income statements, profit and loss statements, balance sheets, statements of cash flow, footnotes and opinions)
- General journal maintenance
- Subsidiary ledger maintenance
- Bank statement reconciliation
By outsourcing your California accounting and bookkeeping, you can lower your overhead costs and turn your focus to growth. You can trust that assets, liabilities and other metrics are being measured, so you can work on business goals and bettering the bottom line. Our firm is focused on accommodating all of your accounting needs, from record keeping to analysis of your company’s financial data. To schedule a reduced rate initial consultation, call me at 800.681.1295 or contact me online.