When it comes to managing the books of your business, one of the most important decisions you need to make is which accounting method to use. Luckily there are just two options: cash-basis accounting and accrual accounting. With cash-basis accounting, the moment that you pay a bill or receive a check from a customer, you…
2017 Mileage Rate & When to Use Standard Rate vs. Actual Car Expenses
Whether you use your car on a daily basis or just periodically for business, you may be eligible for a tax deduction on gas, repairs, maintenance and other vehicle costs. We highly recommend using a mileage tracker app like Hurdlr to have that information ready for tax season. With the Hurdlr, you can track mileage, business…
Top 5 Free Invoice Generators for 2017
One of the key ingredients to a successful business is having positive cash flow. Ensuring you receive the money that customers owe you (commonly known as accounts receivable) in a timely manner is one of the ways to achieve this. If you currently create invoices using a spreadsheet or word processing program, it’s time for…
Excise Taxes: A Guide for Small Businesses
Excise taxes (commonly known as a “sin” tax) is generally charged on products or services that are not considered “good” for consumers or the environment. The most common products that include an excise tax are alcohol, tobacco and gasoline. As a business owner, if you sell a product or service that is subject to excise…
Find Your State Tax Website: A Map of all 50 State Tax Agencies
If you’re opening a store, one of your first steps will be to register with the relevant state tax agency. They will help you find out exactly what taxes you are required to charge, based on your type of business and your inventory. Using a POS such as Lightspeed will enable you to charge customers…
Straight Line Depreciation: How to Calculate & Formula
Straight line depreciation is the simplest way to calculate an asset’s loss of value (or depreciation) over time. It is used for bookkeeping purposes to spread the cost of an asset evenly over multiple years. It can also be used to calculate income tax deductions, but only for some assets, like nonresidential property, patents and…
Sales & Use Tax Guide for Small Businesses
Sales tax is a tax you charge to customers when they purchase products or services from you. As a business owner or seller, you are responsible for calculating, collecting, reporting, and remitting sales tax to the appropriate state and local tax authorities. Use tax is a tax that you have to pay if you purchased…
Double Declining Balance Depreciation Method & Formula
Double declining balance depreciation is a method of depreciation that allows you to expense more depreciation in the early years of the life of an asset and less in later years. This can be beneficial for assets like cars and computers which lose a greater portion of their value in the early years after you…
Units of Production Depreciation: How to Calculate & Formula
Units of production depreciation is a depreciation method that is designed for manufacturing equipment or machinery. It calculates depreciation expense based on the number of products that your machinery or equipment can output each year. Units of production depreciation cannot be used to get a tax deduction. However, it is one of the six methods…
How to Calculate Sum of the Years Digits Depreciation Method
Sum of the years digits depreciation (SYD) is an accelerated depreciation method that lets you expense more of an asset’s cost in the early years of use than its later years. SYD depreciation cannot be used for tax purposes or to calculate your tax deduction. However, it is acceptable for accounting purposes. It is especially…
MACRS Depreciation Tables & How to Calculate
MACRS stands for “Modified Accelerated Cost Recovery System.” It is the primary depreciation methods for claiming a tax deduction. Of course, like all things accounting, depreciation can be tricky and it’s impossible to remember all the intricate details. Click below to download our free ultimate guide to Macrs depreciation. Download Our Free Guide If you’d…
Small Business Owner’s Guide to LLC Taxes and LLC Tax Returns
The primary benefit of organizing your business as a Limited Liability Company (LLC) is that the owners are protected from personal liability if the business is sued. The only other entity that has this same level of protection is a corporation. There are several ways to treat LLC taxes, which can make things a bit confusing….
