November 11, 2022
CCH Axcess Tax Review: Pricing, Features & Alternatives 2023
CCH Axcess Tax is a cloud-based professional tax preparation software ideal for small and mid-sized accounting firms. It’s one module of the CCH Axcess firm management software, which is great for those looking for more than just a tax preparation solution. CCH Axcess Tax integrates with CCH IntelliConnect, a leading tax research service, to provide in-program links to relevant tax authority and analysis. However, for all of its useful features, the pricing isn’t transparent—you must speak with a sales representative for pricing information. CCH Axcess Tax Deciding Factors CCH Axcess Tax Alternatives CCH Axcess Tax Pricing CCH Axcess Tax doesn’t provide pricing and package information on its website. You must contact a sales representative for details. CCH Axcess Tax Features CCH Axcess Tax has many useful features, such as tax research tools and the ability to create tax organizers for your clients. For these and other reasons, we selected it as the best cloud-based software to manage the whole firm in our evaluation of the top professional tax software. However, one of its biggest drawbacks is the lack of integration with QuickBooks and other accounting software. Cryptocurrency solutions: Enhance your end-to-end digital tax workflow process by addressing your clients’ cryptocurrency reporting needs. CCH Axcess Tax integrates with both CoinTracker and Ledgible, streamlining the process. CCH Axcess Portal: With this, you and your clients have access to a secure web-based portal, which allows you to view documents and files. You’ll be able to exchange, store, and organize files, such as a QuickBooks backup file, in one central location. Tax organizers: You can create tax organizers for your clients, which can be printed and sent or emailed. They can also be uploaded to the client portal, allowing clients to access them at their convenience. Clients can upload requested documents to the CCH Axcess Portal. E-filing capability: CCH Axcess Tax offers complete e-filing for all supported forms, and users can check their status easily, viewing alerts and rejections. Digital tax workflow is also available, which automates the entire tax preparation process. Tax research tools: The platform comes with a real-time link to CCH AnswerConnect and CCH IntelliConnect, powerful resources for comprehensive tax research. You’ll have access to explanations of tax law and how to apply it in real-world situations, as well as the ability to research topics and find answers to compliance questions without leaving the tax preparation process. Robust diagnostics: Helpful alerts notify you of incomplete returns or tasks, changes that need to be reviewed, and conflicts that need to be resolved. You can also speed up your on-screen reviews with features such as tick marks and preparer notes. Client communication options: Create professional correspondence that you build from templates and edit in Microsoft Word. Then, save them to libraries and reuse the content in any return. You’ll have complete control of your client correspondence. CCH Axcess Tax Customer Support All registered users have access to support via telephone, email, and live chat. Additional help and support options include product guides, user videos, a searchable knowledge base, and a community user forum. You can also download product enhancements or updates from the website. CCH Axcess Tax Ease of Use has the same familiar user-friendly interface as Microsoft Office, making it easy to navigate. The dashboard gives you quick access to all related projects, tasks, and client documents. Helpful tool tips provide useful information about each particular icon’s function, and you can customize the Quick Access Toolbar with your most-used tools. The enhanced Return Manager allows you to customize information based on what you need to see, and quick filters allow you to arrange tax returns in the desired order. CCH Axcess Tax Integrations Axcess Tax integrates with CCH’s seven Axcess modules, which are: Axcess Document: A cloud-based document management system, which allows you to store electronic copies of tax returns and file backups. Axcess Workstream: Use this integration for tracking projects, with the ability to link to them and update project status. Axcess Portal: You can send and receive client source documents, supported information, and completed tax returns securely with CCH Axcess Portal. Axcess Practice: Time tracking is enabled with the ability to access clocks and enter time from within CCH Axcess Tax. Axcess Client Collaboration: With this unified collaboration hub, you and your clients have access to a secure portal and an enhanced ability to move your clients’ work through the established workflow. Axcess iQ: This integration uses predictive intelligence to gather clients to grow tax advisory services, with the ability to create additional engagements and revenue opportunities within your existing client base. Axcess Financial Prep: This is a cloud-based trial balance solution, which enables you to instantly produce accurate balances for preparing business tax returns. CCH Axcess Tax User Reviews reviews show that users like the fact that it’s cloud-based and easily accessible. They also said it’s user-friendly and easy to navigate and appreciated the integrations for practice management and workflow. There didn’t appear to be any complaints, other than the lack of transparency with the pricing and available packages. The program earned the following average score on this popular review site: TrustRadius: 7.5 out of 10 based on around 10 reviews Frequently Asked Questions (FAQs) Who uses CCH Axcess Tax? CCH Axcess Tax is used by small and mid-sized accounting firms, corporate tax offices, and institutions such as colleges and universities. The software is scalable and integrates with CCH’s workflow and practice management solutions. What does CCH Axcess Tax do? CCH Axcess Tax assists accounting firms with preparing tax returns through features such as a tax research service, robust diagnostics that simplify the identification of errors, and integrations with other CCH solutions that streamline your workflow. How much does CCH Axcess Tax cost? CCH Axcess Tax’s pricing information is unavailable on its website, so you must contact a sales representative for details. Bottom Line has many strong features, including its integration with other CCH Axcess modules for cloud-based management for your entire firm. You can link to the CCH IntelliConnect tax research service without leaving the tax preparation program. Access to strong customer support is also a plus. However, CCH Axcess Tax lacks transparent pricing and is unable to import data from QuickBooks files.
November 11, 2022
Botkeeper Review: Features, Pricing & Alternatives 2023
Founded in 2015, Botkeeper is an automated computer-based service meant to replace manual labor at bookkeeping firms. The virtual bookkeeper supports your accounting practice through machine learning (ML) and artificial intelligence (AI). It was developed to handle your bookkeeping with more accuracy and efficiency than a regular bookkeeper. Botkeeper charges a platform fee starting at $1,000 per month plus $55 per client entity. If you’re unsure whether assisted bookkeeping is right for you, read our guide to the best small business accounting software for great do-it-yourself (DIY) accounting software options. Botkeeper Deciding Factors Botkeeper Alternatives Botkeeper Pricing Botkeeper doesn’t provide detailed pricing information but requires firms to pay both a platform fee and a per-client fee: Platform & Tools: Starting at $1,000 per month Client Entity Fee: Starting at $55 per month Personal Bookkeeper With Botkeeper, support is included with every plan. As soon as you sign up, you’ll be assigned a dedicated account manager who will review your business structure and help you migrate your entire bookkeeping framework to Botkeeper. They’ll also provide onboarding assistance and customization of essential system components. Once that has been completed, Botkeeper will hand your account over to your Bot Team, an expert team of experienced accountants. Your account manager acts as the primary contact, while your Bot Team supports your core bookkeeping processes. Botkeeper also comes with multilevel specialized support to assist you with both bookkeeping and technical issues. You can email your assigned Botkeeper, and your questions will be answered typically within 24 hours of submission. Support can also be accessed via live chat and by phone. Bookkeeping Services In our evaluation of the best online bookkeeping services, we determined Botkeeper to be the best for accounting firms needing to outsource client bookkeeping. Its many valuable services include its mobile app ScanBot, the ability to provide multi-entity accounting, and unlimited custom reports. However, while it has useful features, such as automated bookkeeping via ML and AI, it doesn’t provide full payroll services; instead, it has solely payroll administration. Botkeeper has many features that distinguish it from other online bookkeeping services and accounting software. Tax & Consulting Services Botkeeper does not directly provide tax and consulting services, but it provides a searchable list of its accounting partner ecosystem, which can be filtered by partners that provide tax services. Currently, there are 30 firms that provide tax and consulting services on this list. For an efficient online bookkeeping solution that includes tax and consulting services, we recommend . For its features, services, and pricing, read our Bench review. Frequently Asked Questions (FAQs) How does Botkeeper work? Botkeeper starts by importing all of your client data and connecting the accounts with its software. The data is synced with its proprietary ML tool, which will take note of transactions and categorizations. The services provided are customizable based on your needs. Does Botkeeper support both cash and accrual accounting? Yes, Botkeeper supports bookkeeping on a cash and accrual basis. Does Botkeeper work with QuickBooks? Yes, Botkeeper works with both QuickBooks Online and Xero. Bottom Line provides automated bookkeeping support for accounting firms and businesses by using a powerful combination of skilled accountants, ML, and AI. Clients receive 24/7 accounting support and insight into their financials, with interactive dashboards and unlimited reporting. However, Botkeeper isn’t suitable for small businesses. If you think that its features are too advanced for your needs, we recommend checking out our roundup of the best online bookkeeping services.
November 11, 2022
QuickBooks Premier Professional Services Edition Review 2023
QuickBooks Premier Professional Services Edition, a version of QuickBooks Desktop Premier, is tailored to businesses that bill customers by the hour. Hourly rates can be set by the type of service, employee, or customer, and unbilled time and expenses can be added to invoices easily. QuickBooks Premier Professional Services Edition has the same price as the general business edition of QuickBooks Desktop Premier, which starts at $799 per year for one user. Use Cases Are you looking for something different? If you want to explore other comprehensive accounting software, see our guide to the best small business accounting software. QuickBooks Premier Professional Services Deciding Factors QuickBooks Premier Professional Services New Features for 2023 Cash Flow Hub: The new Cash Flow Hub can help professional service businesses project their future cash flow based on your bank and activity, helping you make budget-related decisions wisely. Automatic mileage tracking: The new mileage tracking app (only for iOS devices) lets you calculate your business mileage automatically. Enter your place of origin and destination, and the app will calculate the mileage automatically. This means you don’t have to track your odometer readings manually. QuickBooks Premier Professional Services Edition Alternatives QuickBooks Premier Professional Services Edition Pricing The QuickBooks Premier Professional Services Edition costs the same as the general business edition. Prices range from $799 per year for one user to $1,999 per year for five users. Your QuickBooks Premier subscription includes free system updates, automatic data backup and recovery, and unlimited customer support. You can add payroll for an additional fee. Here’s a detailed breakdown of QuickBooks Desktop Premier’s pricing: $$799 per year for one user $1,099 per year for two users $1,399 per year for three users $1,699 per year for four users $1,999 per year for five users Businesses that require more than five users will need to upgrade to , which supports up to 40 users. Fit Small Business Case Study We devised an internal case study to create a detailed QuickBooks Premier Professional Services Edition review. Our case study, which uses a unique scoring rubric, analyzes how each accounting software performs against a set of parameters. Professional Services Edition has the general features of the business edition of QuickBooks Desktop Premier, so the rubric scores are the same, as summarized in the table below. These scores are explained in detail in our QuickBooks Desktop Premier review. QuickBooks Premier Professional Services Edition Features Besides the general business edition features discussed in our QuickBooks Desktop Premier review, professional service firms will find even more useful functions in Professional Services Edition. Frequently Asked Questions (FAQs) Is QuickBooks Desktop Premier Professional Services easy to use? Professional Services has the same interface as the base Premier program, so if you have used other QuickBooks Desktop products, then you should find your way around easily. To get the most out of the software, we recommend that you have a dedicated on-site bookkeeper. Who should use QuickBooks Premier Professional Services Edition? Premier Professional Services is great for businesses that bill customers by the hour. Examples are engineering firms, accounting firms, and digital marketing companies. Bottom Line helps businesses that bill clients by the hour (such as engineers, consultants, and lawyers) by managing billing rates so that they can invoice clients effectively. However, it doesn’t track billing adjustments by employee. Larger firms may want to use it for their core accounting needs while using specialized software to track employees’ billable-hour realization.
November 11, 2022
FinancePal Review: Features, Pricing & Alternatives 2023
FinancePal is a cloud-based bookkeeping service that provides dedicated online support for small business owners and entrepreneurs. It’s an all-in-one solution—you can select from a menu of services that includes bookkeeping, accounting, payroll, tax management and consulting, accounts payable (A/P), and accounts receivable (A/R). FinancePal also assists with entity formation and provides catch-up bookkeeping services for businesses that have fallen behind on their books. While it has a great mix of offerings, it doesn’t have upfront pricing, which is something we frown heavily upon when rating bookkeeping services. However, you can contact the provider to receive a custom quote tailored to your business. While the cost will differ based on your needs, our telephone call revealed a starting price of $150 per month. If you’re unsure whether assisted bookkeeping is right for you, read our guide to the best small business accounting software for great do-it-yourself (DIY) accounting software options. FinancePal Deciding Factors FinancePal Alternatives FinancePal doesn’t disclose pricing on its website, earning it zero stars for this category. There are many good online bookkeepers, and most have clear, up-front prices. We contacted FinancePal and found that services start at $150 per month and can be provided either à la carte or as an all-inclusive package. offers transparent pricing, which includes both bookkeeping and tax services. Once you sign up with FinancePal, which integrates with , you’ll be assigned your own accounting team that will take care of your financial needs, whether that’s accounting, payroll, or taxes. They can also offer you valuable insights into your daily and monthly practices. Although they’ll handle most of the work, you can use FinancePal’s intuitive dashboard to monitor your account at any time. This dashboard serves as a client portal, allowing you to send invoices, upload documentation, and review reports. FinancePal has US-based customer support, which is available 24/7. You can also access support via live chat, email, and phone. FinancePal’s website has a frequently asked questions (FAQs) section for each of its services, along with a blog that includes articles about small business topics, such as entity formation and payroll solutions. This easy accessibility is useful if you have urgent issues or pressing tax questions. However, subscribers don’t have access to video meetings, or a mobile app, which is why its score took a hit here. One of its most attractive features is that it gives you access to a team of accounting professionals to work with. Not only will you be assigned a primary and secondary accountant, but you’ll also have access to an invoice manager and any other team member that specializes in the services you have enrolled in. FinancePal’s dashboard is also a bonus, allowing you access to your accounts in real time. Whether it’s bookkeeping, accounting, payroll, tax consulting, or other services like entity formation, FinancePal is a one-stop shop for your financial needs. Integrations: It integrates easily with to ensure that your finances are up-to-date. You can use its other integrations, such as QuickBooks Time, Gusto, and Bill to assist with time tracking, payroll, and bill pay, respectively. We ranked QuickBooks Online as the best small business accounting software, specifically for its project, class, and location tracking that can be customized for any industry. Dashboard: FinancePal’s dashboard is extremely user-friendly, with a clean, simple interface that’s navigable. Billing and invoicing: FinancePal has a user-friendly online platform that allows you to invoice your clients directly online. You’ll also have access to a dedicated team of financial experts who can help you manage your A/R by streamlining your workflow. They can also handle administrative tasks, such as following up with late-paying customers. Reporting: The solution offers standard financial reports, such as profit and loss (P&L) statements, balance sheets, and A/R and A/P reports. You can access these to track your finances in real time. Bookkeeping services: It tailors its services to meet the needs of your specific industry, so in addition to services—such as transaction recording and financial statement preparation—you’ll receive targeted feedback to help improve business operations. Services also include catch-up bookkeeping if you have fallen behind. Accountants specialize in specific industries: FinancePal has industry specialists in agriculture, ecommerce, startups, restaurants and bars, hotels and hospitality, construction, real estate brokers and agents, and real estate investments. Entity formation: It offers an all-in-one solution for entrepreneurs who are in the process of forming their businesses. It can assist with selecting the right business entity, applying for an employer identification number (EIN), and identifying the contracts that need to be drafted. Payroll: It specializes in online payroll support, and its team of experts can handle the majority of your needs. You can customize the services to fit your business, and you’ll have full access to the payroll dashboard. Your payroll expert will calculate, file, and pay taxes on your behalf. FinancePal could have earned a perfect score in this category if it offered sales tax compliance and CFO advice. However, it does provide a variety of tax and consulting services, which include the following: Tax consulting and management: FinancePal can help ensure that you’re always compliant when tax season rolls around. It can assist with annual income tax, quarterly payroll tax returns, W-2s, 1099s, and other tax form preparation. It can also evaluate your liability for sales and use taxes and ensure full compliance with tax laws. Tax consulting: FinancePal’s experts will look at your business structure and where you’re located to determine your tax liability. Tax filing: Your business taxes will be filed by FinancePal, and you can rest assured they’ll be filed accurately and by the deadline. Tax savings: Your tax expert will maximize your credits and deductions to ensure that you save as much money as possible. FAQs How does FinancePal work? FinancePal is a one-stop shop for financial services, offering bookkeeping, payroll, and tax services. You can select from a menu of services that suits your small businesses, outsourcing the work to experienced accountants and tax practitioners. How much does FinancePal cost? FinancePal doesn’t provide pricing information on its website. However, when we called, a representative gave us a starting price of $150 per month. Pricing is customized based on the needs of your business. Does FinancePal have a mobile app? No, FinancePal doesn’t currently have a mobile app. Bottom Line provides customizable financial services. Depending on the needs of your business, you can utilize the services to record and organize your business transactions, calculate taxes, and receive financial statements. The expertise of your team—whether that’s in accounting, tax, or payroll—ensures that you’ll be working strictly with professionals who are familiar with your business and industry.
November 10, 2022
QuickBooks Desktop Pro Review: Features and Pricing in 2023
QuickBooks Desktop Pro, the entry-level version of QuickBooks Desktop, is a locally installed accounting solution that lets you make payments and deposits, send and track invoices, and run payroll within a single platform. It includes key accounting features, like bank reconciliation, accounts payable (A/P), accounts receivable (A/R), inventory, and sales tax management. Prices start at $549.99 per year for one user. If for any reason you’re unsatisfied with , you can request a full refund within 60 days of buying the product. Are you looking for something else? Read our guide to the best small business accounting software. QuickBooks Desktop Pro Deciding Factors QuickBooks Desktop Pro New Features for 2023 Cash Flow Hub: This new feature, which is available in all QuickBooks Desktop products, allows you to manage your cash flow in one place. You can view your account balances easily, add new accounts, monitor cash performance over a certain period, track overdue bills and payments, and create cash flow reports. Automatic mileage tracking: QuickBooks Pro 2023 tracks your mileage automatically, so you don’t have to record your odometer readings manually. You just need to input your place of origin and destination so that QuickBooks can calculate the mileage for you automatically. You can use this feature from your desktop or mobile app (only for iOS devices). QuickBooks Desktop Pro Alternatives The QuickBooks Desktop Pro 2023 version is offered as an annual subscription, and prices start at $549.99 per year for one user. Pro supports up to three users, but each unique user requires a separate license. It includes features like invoicing, inventory, unlimited customer support, and data backup and upgrades. $549.99 per year for one user $$749.99 per year for two users $949.99 per year for three users If you need additional seats, you may need to upgrade to Premier or Enterprise. Read our QuickBooks Desktop product comparison for insightful details on pricing and features. Fit Small Business Case Study To uncover the strengths and weaknesses of QuickBooks Desktop Pro, we developed an internal case study, which evaluates the program across several accounting metrics. Using a structured scoring rubric, we gave QuickBooks Pro a score of anywhere from 0 (very poor) to five (excellent) for each category (e.g., pricing, features, and ease of use). Below is the summary of our case study for QuickBooks Desktop Pro. QuickBooks Desktop Pro vs Competitors QuickBooks Desktop Pro’s biggest strengths are inventory management, banking, and project accounting. However, it trails behind its online counterpart, QuickBooks Online, in terms of A/P, A/R, and reporting. QuickBooks Pro’s shortcomings are fixed assets and mobile accounting. QuickBooks Desktop Pro Features QuickBooks Desktop Pro is a complete bookkeeping application that comes with a long list of features. Below we present the detailed evaluation of QuickBooks Desktop Pro across the different categories in our case study. Frequently Asked Questions (FAQs) Is QuickBooks Pro right for me? If you have no more than three accounting users, need basic inventory tracking, and don’t need remote access to your books, then QuickBooks Pro is right for you. Is QuickBooks Pro available as a one-time purchase? No, it isn’t. QuickBooks Pro and other QuickBooks Desktop products are no longer offered as a one-time purchase. Instead, subscriptions are purchased on an annual basis. When do I need to upgrade to Premier or Enterprise? If you need access for up to five users and require an industry-specific edition like Retail and Manufacturing and Wholesale, then choose Premier. If you need up to 40 users and desire advanced inventory, like multilocation tracking, then you should upgrade to Enterprise. Bottom Line is a powerful desktop accounting solution, particularly for companies with in-house bookkeepers. It may not offer the accessibility and convenience of cloud-based software, but it has many strong features that are worth considering. If you only need a few users and have no intensive inventory to manage, then it’s a great accounting solution for your business.
November 10, 2022
Pilot Bookkeeping Review: Features, Pricing & Alternatives 2023
Pilot Bookkeeping, launched in 2017, is a financial services firm that focuses on providing bookkeeping, chief financial officer (CFO), and tax services for startups and small businesses. It’s geared toward rapidly growing businesses, acting as a one-stop financial shop for small companies looking for chief financial officer (CFO) consultants, even assisting with research and development (R&D) loan applications for an additional fee. It also specializes in working with high-growth technology startups, ecommerce and professional service providers, and nonprofits. Pricing starts at $599 per month for businesses with less than $30,000 in monthly expenses. If you’re unsure whether assisted bookkeeping is right for you, read our guide to the best small business accounting software for great do-it-yourself (DIY) accounting software options. Pilot Bookkeeping Deciding Factors Pilot Bookkeeping Alternatives Pilot Bookkeeping is very expensive compared to other online bookkeeping services. However, it is probably still less expensive than hiring a local certified public accountant (CPA) for bookkeeping, tax handling, and consultancy services. Its bookkeeping services are based on an annual subscription model, with pricing that scales with your monthly expenses and your business needs. It also charges an onboarding fee that’s equal to one month of bookkeeping. The services are billed on an annual basis. Pilot offers other financial services for an additional fee. Pilot CFO: Starting at $1,350 per month, billed annually for monthly engagement and $1,500 per year for annual budgeting and forecasting Pilot Tax: Starting at $1,950 per year for tax services, including federal corporate income tax and 1099-MISC filing A/P and A/R: Starting at $125 per hour for support with paying bills and creating and sending invoices Controller services: Starting at $200 per hour for assistance with building the right finance operations Research and development (R&D) tax credit: Price is computed at 2% of total qualifying expenses. When you sign up for Pilot, you’ll be assigned a dedicated bookkeeping expert who’ll serve as your point of contact. They’ll walk you through how to integrate your existing processes and software with QuickBooks. If you have any questions, you can speak with your account manager through the QuickBooks portal or by email at no additional cost. Before the formal bookkeeping process begins, Pilot will onboard clients to introduce the bookkeeping software and show how the process works. The onboarding process will also help Pilot experts know what to expect and what needs to be done. Clients will also be introduced to their dedicated bookkeeping expert upon onboarding. Upon onboarding, the dedicated bookkeeping expert will log important notes about the client to help Pilot fully understand the client’s business and operations. This log can be found in the Customer Context tab. These notes are regularly maintained to make it easy for anyone in Pilot to help the client in case their dedicated bookkeeper is out. In our evaluation of the best online bookkeeping services, we rated Pilot Bookkeeping as the best for startups. Its many valuable services include a detailed monthly reporting package and add-on CFO and tax services. However, while it has useful features, such as Reviewbot, an artificial intelligence (AI) tool that flags missing or inaccurate transactions, it doesn’t provide payroll services and cash-basis accounting. Pilot Tax, a full-service tax preparation service, will take care of your state and federal income tax filing, as well as any 1099s that you need to issue to contractors. You’ll be assigned your own dedicated tax preparer who will answer all of your questions and provide you with access to live status updates of all of your filings. Businesses that are just getting started would benefit from the Essential plan, which provides support for unprofitable C-corps and is priced at $1,950 per month. Pilot’s Standard plan is ideal for growing businesses with net income or foreign subsidiaries, and custom pricing is available starting at $4,950 per year. Both plans include federal and state corporate income tax filing, Delaware franchise tax filing, 1099-NEC filing, and email support. Frequently Asked Questions (FAQs) What software does Pilot Bookkeeping use? Pilot exclusively uses QuickBooks Online for its bookkeeping. What are the requirements to start with Pilot Bookkeeping? To get started, Pilot has three requirements to deliver the most accurate books for your business: electronic transaction access, expense reporting software, and no commingling of personal expenses. Is support included in Pilot? Yes, support is included in your plan. Your dedicated bookkeeper can answer any of your questions either through the QuickBooks portal or email. Is it possible to migrate my books from Xero to QuickBooks? Yes, Pilot can transition your books to QuickBooks Online. As part of your onboarding process, Pilot will migrate summarized monthly information from Xero to QuickBooks, going back to the beginning of the year. Bottom Line is a financial service provider tailored to startups and small and medium-sized businesses (SMBs). Aside from its bookkeeping solutions, it also offers advice to growing businesses from CFO consultants and tax advisors. It also connects your business with a dedicated account manager who’ll learn the ins and outs of your business quickly. Using a blend of custom software and expert bookkeepers, it can deliver accurate bookkeeping at a price that can be customized based on the needs of your business.
November 9, 2022
What Are Non-deductible Business Expenses?
According to the IRS, a deductible business expense must be both ordinary and necessary. Therefore, any expense that isn’t ordinary and necessary to your business’s operation is non-deductible. In addition to this broad definition, the IRS provides guidance on specific business expenses that cannot be deducted. This article gives more information about each of these non-deductible business expenses, along with examples. Business Entertainment The 2017 Tax Cuts and Jobs Act has eliminated the deduction for entertainment expenses, which means you can’t deduct the cost of entertaining clients at sporting events, concerts, or private clubs. It doesn’t matter whether you invite and discuss business with a client or employee, any expenses related to entertainment aren’t deductible. However, business meals at entertainment events are deductible if you have an itemized receipt that states the cost of the meals separately from the entertainment event. Let’s say you invite your favorite client to a baseball game. You purchase tickets for both of you in advance and treat your client to hot dogs and drinks while at the game. Because the baseball game is considered entertainment, it isn’t deductible. The cost of the hot dogs and drinks, which are purchased separately from the tickets, isn’t an entertainment expense and isn’t subject to the disallowance. Therefore, you may deduct 50% of the expenses associated with the hot dogs and drinks purchased at the game as a meal expense. 50% of Business Meals You can generally deduct only 50% of your food and beverage costs, with the caveat that they can’t be “lavish or extravagant” and the business owner or employee must be present. In 2021, the Consolidated Appropriations Act allowed for a full 100% deduction for business meals in 2021 and 2022 as long as they are provided by a restaurant. Here are some of the most common 50% deductible expenses that are 100% deductible if purchased from a restaurant before the end of 2022: A meal with a client where work is discussed (that isn’t lavish) Employee meals while traveling Employee meals at a conference, above the ticket price Food for a board meeting Dinner provided for employees working late Taxes Taxes that cannot be deducted as business expenses include: : Federal income taxes 50% of self-employment taxes are non-deductible, and 50% are deductible as an adjustment to income for the sole proprietor or partner Estate, inheritance, legacy, succession, and gift taxes Taxes on real property apportioned at the time of closing Employers are allowed to deduct employment taxes, such as social security and unemployment tax, that they must pay on the wages of their employees. Penalties & Fines Fines and penalties that a business pays to the government for violation of any law are never deductible. For example, you can’t deduct an underpayment penalty, late payment penalty, or late filing penalty. However, interest paid to the IRS is deductible if the underlying income tax liability is business-related. Nondeductible penalties and fines aren’t limited to tax-related items. Any fine or penalty is nondeductible. For instance, no matter how much you argue that speeding is an ordinary and necessary thing for your business, the fine for your speeding ticket isn’t deductible. Political Contributions Gifts and contributions that are made to political parties are generally not deductible as are expenses incurred to participate in any political campaign of a candidate for public office. The rule applies to indirect contributions as well, such as advertising in a program for a political party’s convention or tickets to an inaugural ball that is identified with a political party. In both cases, if the proceeds from the program or event are for the party’s or candidate’s use, the associated expenses are non-deductible. Illegal Payments Payments made to officials or employees of a foreign government aren’t deductible if the payments are unlawful under the Foreign Corrupt Practices Act of 1977. Additionally. payments made to officials or employees of any government other than a foreign government aren’t deductible if the payments constitute an illegal bribe or kickback. A kickback is a payment for referring a client, patient, or customer. It commonly occurs when money is given to someone to influence a third party to purchase from, use the services of, or otherwise deal with the person who pays the kickback. Interestingly, ordinary and necessary business expenses of an illegal business are deductible against the income from the illegal business. An example would be the security expense for an illegal gambling hall or bribes of government officials. It sounds odd to think of a tax return being filed for an illegal business and the ordinary and necessary expenses being deducted. These returns are usually filed after the suspect is arrested and the IRS learns of the untaxed income. Business Expenses of Drug Trafficking Unlike most illegal activities, the ordinary and necessary expenses of drug trafficking aren’t deductible. You can’t, for example, deduct the money you paid for smuggling illegal substances into the country, money laundering, or other illegal activities like bribes and kickbacks. When someone in the drug trade is arrested, the IRS can include all estimated income they earned in taxable income without allowing any deductions against that income. This is much harsher than for other illegal activities where business deductions are allowed. Purchases of Property, Plant & Equipment One of the principles underlying the tax rules for deductions is that your income for the year should only be offset by those expenses that contributed to earning that income. Capital expenditures to acquire or improve a business asset that will last longer than a year aren’t deductible as business expenses. The IRS considers capital expenditures for purchasing long-term business assets—like vehicles, equipment, and buildings—as investments in your business, not expenses. In this case, you might be able to deduct the entire purchase price under Bonus Depreciation or Section 179. The IRS has adopted new rules designed to help classify whether an item is a “repair,” which is generally deductible in the year it’s made, or an “improvement” that must be added to the property’s basis and deducted over a period of years. Because these rules are complex and could have huge tax ramifications, it’s a good idea to consult with an accountant before making any substantial repairs or improvements to your property. The following items have been considered as capital expenditures by the IRS: Burglar alarm installation charges Flood protection costs Business facility improvement costs, such as replacing a roof Insulation costs Display cases, remodeling costs Cable replacement costs upon sudden failure Office, cost of changing location and equipment Electrical system replacement costs Determining whether a payment is a deductible expense versus a capital expenditure can be difficult. Bench provides unlimited tax advice in its Premium bookkeeping plan. What Is an Ordinary & Necessary Business Expense? Unless an expense falls into one of the nondeductible expenses listed above, it can be deducted if it’s ordinary and necessary. Ordinary is usually interpreted by the courts to mean an expense that’s common within a specific trade or business while necessary means helpful and appropriate. If you run a delivery business, ordinary and necessary expenses would be the fuel, maintenance, and tolls associated with your vehicles. Here are some examples of ordinary and necessary business expenses that are deductible: Administrative expenses like licenses, insurance, and bookkeeping Office supplies to support your business Attorney and accountant fees Employee compensation Employee-sponsored retirement plans, such as 401(k) Rent for office space Bank charges Commissions and sales costs Contract labor costs Dues and subscriptions Postage and delivery fees Equipment rentals Software Utilities Advertising and promotion Internet subscriptions, domain names, and hosting Bottom Line Simply stated, business expenses that aren’t ordinary and necessary for your business cannot be deducted. In addition, in the broad ordinary and necessary test, there are several expense types that are explicitly made nondeductible in the tax code, including entertainment, taxes, penalties and fines, political contributions, and capital expenditures.
November 9, 2022
How To Delete a Deposit in QuickBooks Desktop
QuickBooks Desktop allows you to delete errant deposits while restoring the checks included in the deposit to the undeposited funds account where they can be edited or removed completely. You might need to delete or undo a deposit for several reasons, such as an incorrect check added to the deposit or a duplicate deposit. In this tutorial, we’ll walk you through the steps on how to delete a deposit in QuickBooks. Deleting a deposit in QuickBooks Desktop is easy—one reason the platform is on our list of the best small business accounting software. If you don’t have an account, we compare all QuickBooks Desktop versions to help you decide; all come with a 60-day money-back guarantee. You may visit the provider’s website to learn more. Delete a Deposit When Not Made From Undeposited Funds While we recommend always running your deposits through undeposited funds, the alternative is to record a check being immediately deposited in your bank account when received. For instance, when receiving a check against a customer invoice, you can choose to deposit the check immediately. The process for deleting this deposit is the same as the above steps. The difference is, rather than appearing in the undeposited funds account after deletion, the customer’s check will be deleted and any invoice it offset will now have an open balance. Frequently Asked Questions (FAQs) When is it necessary to delete a deposit in QuickBooks Desktop? Some of the reasons you need to delete a deposit in QuickBooks Desktop include incorrect data entered, incorrect checks added to the deposit, a duplicate deposit is created, or the deposit is added to the wrong customer account. What happens after a deposit gets deleted? The checks associated with the deposit are reverted to the undeposited funds screen, where they’re available for delete, edit, or deposit again. If the original deposit wasn’t from the undeposited funds account, deleting the deposit will reverse the original entry. Can I delete multiple deposits all at once? Yes, but you have to be using QuickBooks Enterprise. Wrap Up Congratulations on completing our lesson on how to delete or void a deposit in . If you’re considering a switch to QuickBooks Online, be sure to check out our tutorial on how to convert QuickBooks Desktop to QuickBooks Online.