Welcome to One Stop Consulting Shop! We are excited to have you as a client and to be your trusted partner as your accounting team! We believe transparency is crucial as we outline our working relationship. Please follow the instructions outlined below and if you have any questions, please email: email@example.com.
Together, we will plan today for a successful tomorrow!
Remember, W2 employees complete a W4 and I9 form. Contractors complete W9. All employees/contractors must complete an Authorization for Direct Deposit Form. As the owner, you must complete the Onboarding Form and Financial Responsibility form.
As a new business owner, we understand you may not be aware of or have questions about things like mileage deductions, home office deductions and Tangible Personal Property returns which are required to be sent to your County by April 1st. Please also remember that any business expenses you have incurred that we may not have access to must be provided to us so we can ensure they are added to your bookkeeping. Please make sure we have a list of these items including date, vendor, amount, what it was for and how it was paid.
Below is a summary of these items and if you have questions, please reach out to us to schedule a phone call or email us: firstname.lastname@example.org
You are going to want to keep a mileage log (and may need to recreate one from the beginning of the year if you are not already keeping one). What needs to be tracked is the following is bulleted below. We have also attached a template for you to use. Some clients like to use Mile IQ which is fine, but keep in mind it needs to be properly set up (with addresses). You cannot just enter a City to City and list “for Business” for the entire log.
Mileage (You must have a written mileage log even if you claim actual receipts):
a. Year, make and model of the vehicle
b. Starting odometer on January 1st (of the tax year) and Ending odometer on December 31st
c. Total business miles
Also, keep in mind that if you are using a personal vehicle for business, you may want to consider obtaining Commercial Vehicle Insurance for liability protection.
Home Office Deduction
To take a home office deduction, you must have a separate and distinct area of your home used solely for business. To track this, there are two options. The option that you can use depends on the type of tax structure you have set up for your business. Let’s discuss this in further detail during our next conversation if you have questions about it.
There is the method that takes a percentage of actual expenses or what is called the “simplified method”.
Actual Receipts Method:
a. Square footage of the home
b. Square footage of the office area
c. If your own your home, we need (total paid for the year): utilities, mortgage interest, property taxes, home owners’ insurance, cleaning, home security, water bill, internet only, landscaping and any improvements made to the home that also affect the office area
d. If you rent your home, the we need the total rent paid for the year and total fees for utilities, home security, cleaning, renters’ insurance, internet only and any improvements to the rental that affect the office area
Or, if you choose to not itemize your expenses on the home office deduction and use the Simplified Method, we simply take $5 per square foot deduction for home office, up to 300 square feet, (a total of $1500 deduction), no questions asked, no expenses needed! Then, there is no depreciation recapture when you sell the property if you own the home.
Tangible Personal Property (annual return due April 1st to your County):
You are also going to want to keep a running list of your fixed assets (these are things that are permanent, meaning they have a lifespan longer than 6 months and usually a cost of above $500. Each April a TPP (Tangible Personal Property) return must be submitted to your county. Usually, most small businesses will do the first one and because your assets are under $25,000, there will be no tax and you’d have a postcard exemption from filing for the next 5 years UNLESS you purchased new items that needed to be reported.