I still remember the first time I filed taxes for my business. In addition to having no idea what a write-off really was, I also didn't worry too much about guessing on the numbers. A few government audits later, I discovered what it really meant to do things the right way. Over the years, I have met lots of business owners that weren't too worried about fudging the numbers, and nearly all of them have run into problems. Proper accounting is important, which is why I created this website dedicated to business accounting. I know that if you learn the right way to do things and focus on integrity, your business can avoid a world of problems.
As a new home-daycare business owner, you need a reliable accountant on your side to take care of all the financial aspects. Here are three important considerations to make that will help you figure out which potential accountant will be the best fit for you and your business:
If you plan to service children whose families receive government subsidies for child care services, there may be special forms that you have to fill out for those subsidies to be recognized and for you to get paid. You may also be able to receive subsidies yourself if a majority of your daycare clients are using government assistance to pay you.
It's important to make sure that the accountant you decide to hire has experience with government subsidies and understands how best to process any vouchers you receive and billing statements you need to send. Ask each accountant you consult with for an outline of how they handle government subsidies and how it differs from your regular income accounting.
Unexpected Financial Changes
The nature of the home-daycare business is pretty unpredictable, as children will likely come and go on a regular basis. All states have specific laws about how many children can be watched at one given time during business hours as well, and your laws may change as time goes on which will affect how many children you can bring on board at once. You may also find that a parent or two gets a couple of months behind on their payments, or never pays for the last month of service before leaving.
These considerations and more will undoubtedly create unexpected financial changes as your business expands and detracts depending on the time of year, and the number of clients you have. So it's a good idea to hire an accountant who is good at working with unexpected changes and who doesn't mind having to create new spreadsheets and put in a little extra leg work to keep up with your changing finances.
As a home-daycare provider, you have the opportunity to claim a variety of tax write-offs throughout the year, and you'll need an accountant who will help you identify all of the deductions you qualify for. Something as simple as purchasing diapers or driving children to the park can score you a deduction, so make sure that the accountant you hire is willing to do the research and come up with an extensive list of write-offs for you to be aware of, and how to document them so they can be claimed at tax time.
These considerations should make it easy for you to determine which potential accountant will meet your long-term needs and help your business effectively expand.Share
12 September 2016