March 2018 Blog Posts

  • Why Every Company Needs A CFO, Chief Financial Officer For Strategic Advice

    March 30, 2018

    Is your company profitable enough for a CFO? The answer is yes. A CFO can provide invaluable strategic advice that keeps your company moving forward. The problem that most small businesses face is the cost of hiring a CFO.

    Because of the cost, most CEOs also function has a defacto CFO. This is fine until the company starts to grow. Then the CEO becomes preoccupied with finance-related tasks and can’t focus on long-term revenue-generating activities. This is where a CFO-like business consulting services can be beneficial. A few areas where a consulting services can be helpful are by creating a strategic business plan and performing crucial tasks like a cost and profitability analysis.

    Creating A Strategic Business Plan

    Improving performance should be a top priority for any company. Without continual improvement, a company fails to thrive and grow. Analyzing current business problems can expose troubled areas that need improvement. In order to develop a proper action plan, three different types of strategy need to be created.

    • Business Strategy
    • Market Strategy
    • Pricing Strategy

    By creating these types of strategy, you’ll get a better overview of where your company needs to improve and what actions are needed to improve.

    Cost & Profitability Analysis

    Tracking and controlling costs is the first step to improving profitability. Most businesses won’t last long without a plan. Unfortunately, the data can seem overwhelming for many business owners and they can end up with a subpar pricing strategy.

    By using a cost and profitability analysis, the consulting service can provide strategic advice based on a variety of factors to help you determine the best business opportunities and pricing models to help you maximize your profits. A few include:

    • Quantifying historical data
    • Reviewing inventory values
    • Review current pricing structures

    Hiring a full-time CFO isn’t a necessity, but every company needs strategic advice that the CEO can’t provide.

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  • What You Need To Know About A 1099 Form

    March 15, 2018

    What You Need to Know About A 1099 Form

    Do you work as a freelancer or independent contractor? Chances are you’ll receive a 1099 form. If you make more than $600 with a client, they are required to send you a 1099 form by the end of January. Instead of of receiving a typical W-2 that traditional employees receive, most freelancers will receive the 1099-MISC form that is used to confirm that all their earnings are reported to the IRS.

    While this can be overwhelming for new freelancers and independent contractors, a little organization can go a long way. Proper organization allows you to maximize your tax write-offs and keep more of your earnings. Deductions such as car expenses and home office deductions are a couple of the biggest tax breaks you can get.

    Car Expenses

    Car expenses including mileage can provide one of the biggest tax write-offs for freelancers. The easiest method to use is to claim the standard mileage rate. This allows you to write off 54 cents off every mile you drive for business-related purposes. These miles include:

    • Driving while working
    • Going to meet clients at a seperate location
    • Heading out of town on business

    The standard mileage rate takes into account gas, insurance, maintenance, depreciation, and insurance. While you can use the actual method of deducting your car expenses, the standard mileage rate is far easier to track and report.

    Home Office Expenses

    If you’re running an independent business from your home, you can potentially write off part of your home expenses. As long as you have a dedicated space that serves as your primary place of business and is used exclusively for work, you can use it as a tax write-off. Using the simplified method is the easiest way to deduct your home office. It includes everything in your home office and can be figured out by finding the square footage of your home office. Here are a few things you need to know:

    • You can deduct $5 per square foot.
    • You can only deduct up to 300 square feet per year.
    • Total deduction cannot exceed $1500.

    Make sure you don’t miss out on any deductions. BIG offers professional tax services to make sure you get the most tax write-offs possible.

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