Knowing When to Start A Business

It is not uncommon to hear that a downturn in the economy is a good time to start a business.

However, according to the Bureau of Labor Statistics, the numbers show that small business start-ups have slowed. The number of people calling themselves self-employed went from 16.3 million in 2006 to 15.6 million in 2008.

Economists say the creation of a certain amount of new sole proprietorships is common in weak economic cycles.

"Job market insecurities and the desire for a freer lifestyle prompt some to take risks," said Brian Headd, an economist with the Small Business Administration (SBA).

Yet, one explanation for slow start-ups maybe the current tightening of the credit markets. Therefore, access to capital is more of an issue than ever before in the world of the small business owner. Even well-established businesses are having difficulty gaining access to existing credit.

With all this in mind, if you still believe the time is now to start a new business, keep in mind some key questions and points:

-Why do you want to start a business? To get rich? To get paid to do what you love? Or both?

-How hard are you willing to work? Chances are, in starting a business, you will work harder than you've ever worked in your life.

-What businesses will be your competitors? What's the state of your industry? Visit ReferenceUSA.com, Dun and Bradstreet Key Business Ratios and County Business Patterns.

-Develop a Business Plan that will help 1) identify your market; 2) identify your competition 3) determine start-up costs 3) get and idea for an exit strategy as well as a start-up strategy

-Develop a web site and an online marketing strategy

-Get a mentor

-Identify family and friends you know you can count on for support

-Know how much money you will need and how much of yours you are willing to invest

-Identify a good accountant - particularly one that specializes in small businesses

-Become familiar with potential tax liabilities in the beginning and budget for them

-Keep costs and overhead low

-Set-up a system for operating (even if it's just you at first)

-Finally, A.B.N. - Always Be Networking. This combined with a strategic, low cost advertising and marketing campaign can be the key to your success.

Year End Tax Planning Tips

It's often said that there are only two things in life that are certain - death and taxes.

To help you manage the uncertainty often associated with having to deal with the Internal Revenue Service (IRS), we'd like to offer some timely tips designed to help you get ready for the new tax year.

Get Organized - now! This has to be the single most important thing you can do right now to get ready for next year. We know it's the holidays - a time for sharing with family and friends. However, it is also a good time to get any and everything financially-related to your 2008 tax year right now. It's down time for most and in addition to getting some much deserved rest, you can save yourself the stress and the hassle of getting ready for your tax year by pulling together all the important documentation right now, before January 1st.

Determine If You Qualify for the Recovery Rebate. If you did not qualify or did not receive the maximum amount for the 2008 economic stimulus payment, you may be entitled to a recovery rebate credit when you file your 2008 return. To determine what your stimulus payment was, visit the IRS for Stimulus Payments.

Determine Your Expenses. Gather up all receipts, bank statements and credit card statements. Be sure to keep your personal receipts separate from your business receipts. For help with this, visit our tax organizer that will help with preparing your taxes more easily and know what is missing way in advance of tax preparation time.

Know Your Rights as a Taxpayer. Throughout your contact with the IRS, the representative will explain and protect your rights as a taxpayer. You have a right to know why the IRS is asking for information, how it will be used and what happens if you do not provide the requested information. For more information, visit the Declaration of Taxpayer Rights.

For more important tax information for you as a small business owner, consider downloading the 2009 IRS Tax Calendar for Small Businesses & the Self-Employed.

Happy Holidays from Optimum Tax & Accounting Services.

IRS Collections from Audits Fall in 2008

By KEVIN FREKING

WASHINGTON (AP) — The amount of money the IRS collects from audits and other reviews fell by nearly $3 billion this year as the agency shifted resources to make sure people got their economic stimulus checks.

Overall, collections dropped to $56.4 billion for the fiscal year that ended Sept. 30 — a 4.7 percent decrease from $59.2 billion collected in 2007, the agency said Monday.

It was the first year-to-year decrease in collections in a decade.

In addition to its regular duties, the IRS issued 117 million payments totaling more than $95 billion as part of the federal economic stimulus program this past spring.

"There was the challenge of doing stimulus and it was a tight budget year. Key enforcement resources actually declined slightly," said Linda E. Stiff, deputy commissioner for services and enforcement. "The other key point to note is that 2007 was a record-breaking enforcement year, a high-water mark by any and all definitions."

Stiff said that when comparing 2008 to 2006 and earlier years, "you still have a healthy increase and a good trend even though we weren't able to repeat the anomalies of 2007."

The number of reviews of returns filed by individuals increased slightly this year. Those earning less than $200,000 had about a 1 percent chance of being audited. Those with incomes of more than $200,000 had about a 3 percent chance of being examined.

Meanwhile, taxpayers with incomes of more than $1 million had a 5.6 percent chance of being audited, a drop from 6.8 percent the year before. The number of audits for millionaires dropped even though their ranks increased by nearly 54,000. Sit-down audits with those making more than $1 million remained relatively flat. The big drop occurred with reviews conducted through correspondence.

Again, officials attributed part of that decline to staffing. They noted that the agency had about 465 fewer agents and officers in key enforcement occupations compared to the year before.

For more, visit the Associated Press and the IRS.

Government Bailouts: Leave No Small Business Behind

With all the talk about government bailouts for some of our nation’s largest corporations, clearly one segment of the U.S. economy being left out is small businesses.

Small Businesses are in desperate need of a “bailout solution" designed to help them weather the nation’s current economic storm.

Like individual taxpayers, small businesses seem to be left to fend for themselves while corporations appear to be receiving blank checks – unless they are a Big 3 automaker.

The irony is that small businesses have been known to serve as the economic engine of the United States since its inception.

According to the National Small Business Association (NSBA), 70 million people in the U.S. either work for or are running a small business.

Other key issues sited by the NSBA:

 50% of small-business owners cite “economic uncertainty” as one of the most significant challenges they face to the growth and survival of their business

 Spikes in energy costs have negatively impacted 77 percent of small-business owners, according to the February 2008 NSBA survey.

 In 2008, only 38 percent of all small businesses were able to provide health insurance to their employees, down from 61 percent in 1993.

 Credit cards continue to be the largest source of financing for small businesses, yet 57 percent report that their credit card terms are worsening.

So, with all this tough news, what is a small business to do? One solution is to partner with a solid business accounting firm that specializes in small businesses and understands the unique challenges that go along with operating as a small business.

One model of such a firm is Optimum Tax & Accounting Services known as The Small Business Accounting Experts.

For businesses that – now more than ever – are looking for more ways and more time to grow their business and provide top quality customer service should make it a priority to invest in the services of a small business accounting firm.

With the current economic climate, the small business owner has enough to be concerned with without also having to worry about the order of their bookkeeping and meeting business tax obligations in a timely fashion.

An accounting firm like Optimum Tax & Accounting can provide payroll services; bookkeeping; monthly, quarterly and annual financial statements, business loan and line-of-credit application preparation assistance; business tax preparation and tax planning, business and marketing plan development and so much more.

The key benefit about Optimum’s services is that they are affordable with the small business owner in mind.

To begin taking advantage of a bailout solution with the small business owner in mind, contact Optimum Tax & Accounting Services for a free business consultation today.

Greensboro Accounting Firm Eases the Burden of Payroll Expenses for Small Businesses

With record declining payrolls nationwide as 533,000 jobs were reported loss for November, a Greensboro accounting firm is playing a role in relieving the payroll expense burden of small businesses.

Optimum Tax & Accounting Services, LLC is providing free business payroll assessments and 30-days free of payroll services to small to medium size businesses and non-profit organizations.

“With my decade of small business accounting experience, I’ve never seen an economic environment like the one we’ve been confronted with over the last 18 months, “says Pamela Murray, President and CEO of Optimum Tax & Accounting Services. “There is no question that businesses need a relief – especially small businesses. Therefore, we are prepared to provide payroll business expense assessments as well as other business expense assessments – at no cost - to help small business owners see exactly where they are so that they may be better prepared for the upcoming tax year.”

Murray added that she has seen so many small businesses struggle unnecessarily. Oftentimes, most just need a bit of help, guidance and information to get them through the rough economic times such as these.

Author of the blog: Optimum Accounting for Small Business, Murray just wrote a recent entry 5 Keys to Weathering Tough Economic Times for Today's Small Business. There she offers tips designed to help small businesses get a handle on the challenges faced with slow economic times on everything from slow-paying customers to good old fashion belt tightening in the form of expense management.

For more information on the free payroll expense and business expense assessment and the 30-days of free payroll services, contact Optimum Tax & Accounting at 336-854-7083 or email info@optimumtaxandacc.com.

You may also visit Optimum Tax & Accounting Services. For additional press information, contact Valencia Roner at 336-854-7083.