FAQ

Due to the varying complexities of businesses and their requirements, it is impossible to put a definitive number on the overall cost of bookkeeping services. For example, a sole trader’s bookkeeping needs will differ greatly from a retailer that pays staff!

We offer a FREE consultation to discuss your business needs and identify ways we can help you to grow your business. Once we have a strong understanding of your business and expectations, we can discuss a package that suits you.

Put simply, bookkeeping is “the process of recording, analyzing and interpreting the financial transactions of a business or individual.” Melanin Tax Solutions aims to go further than this to partner with and educate our clients on their business, systems, operations and results.

A good bookkeeper can be a huge asset to your business as they have the knowledge, experience and passion to manage your records accurately. Most importantly, they provide you with an important insight into your business’ operations and profitability.

Of course, whether or not you need a bookkeeper depends on the size and complexity of your business. If you’re a solopreneur or have a very small business, you might be able to get by without one. But if your business is growing and you’re starting to feel overwhelmed by the financial side of things, it might be time to hire a bookkeeper.

Bookkeepers can provide valuable assistance in keeping your financial affairs in order. They can help you stay organized, compliant, and on top of your tax obligations. If you’re not sure whether you need a bookkeeper, consider speaking with one to get a better sense of what they could do for your business.

The double-entry bookkeeping principle means that every financial transaction will involve at least two accounts. This method gets its name because you enter all transactions twice.

In double-entry bookkeeping, a transaction always affects at least two accounts, always includes at least one debit and one credit, and always requires that total debits and total credits be equal. This is to keep the accounting equation (assets = liabilities + equity) in balance.

Because transactions are entered twice, double-entry bookkeeping is a practice that helps to minimize errors and increases the chances that your books balance. 

Bookkeeping and accounting are often assumed to be the same profession. This is not the case!

Both are extremely important for every business, especially when used together. While bookkeeping is responsible for the recording of financial transactions, accounting is responsible for interpreting and analyzing financial data.

A bookkeeper will be the person who assists you with the ongoing financial recording, transactions, compliance and lodgements that keep your business running smoothly. Your accountant will be the person who analyses the data produced by your bookkeeper to minimize your taxation and make recommendations. Accountants have a strong understanding of tax law & requirements and will be best to assist in this area.

Instead of perceiving a “bookkeeper vs accountant” situation, it is important to understand that your accountant and bookkeeper work best together to serve the financial requirements of your business.

The IRS recommends the following guideline for keeping tax records:

• Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.
• Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.
• Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.
• Keep records indefinitely if you do not file a return.
• Keep records indefinitely if you file a fraudulent return.
• Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

Yes, we can. By taking a deep dive into your business and expenses we can help determine which items are deductible.

The IRS defines the QBI as follows:

Many owners of sole proprietorships, partnerships, S corporations and some trusts and estates may be eligible for a qualified business income (QBI) deduction – also called Section 199A – for tax years beginning after December 31, 2017. The deduction allows eligible taxpayers to deduct up to 20 percent of their qualified business income (QBI), plus 20 percent of qualified real estate investment trust (REIT) dividends and qualified publicly traded partnership (PTP) income. Income earned through a C corporation or by providing services as an employee is not eligible for the deduction. For more information on what qualifies as a trade or business, see Determining your qualified trades or businesses in Publication 535

We suggest meeting with the advisors at Melanin Tax Solutions if you have any questions about your business tax deductions.

Purchase of all tangible goods (unless a specific exemption exists) and some services are subject to sales tax. There is a presumption that “all gross proceeds of sales and the gross income derived from a business activity classified under a taxable business classification comprise the tax base from the business until the contrary is established.” In other words, all sales are considered taxable until the seller of goods or services provides proof that the sale should be nontaxable or tax exempt. Sellers overcome this presumption by requiring that customers believing their purchases to be exempt from tax provide an exemption certificate.

Common Sales Tax Exemptions on Purchases of:

• Professional or personal services (if not as part of the purchase of tangible personal property)
• Tangible personal property purchased for resale
• Warranty or service contracts (if not required as part of the purchase of tangible personal property, and listed separately in the invoice)
• Prescription drugs, certain medical equipment, prostheses, insulin, prescription eyeglasses, and hearing aids
• Printed and other media materials purchased by publicly-funded libraries and made available to the public (materials not available to the public are not exempt; equipment is not exempt either)
• Internet access and cable services
• Custom computer software (pre-written software and pre-written software update are taxable)
• Conference fees
• Professional membership dues
• Machinery and equipment used in research and development
• Chemicals used in research and development
• Food for (human) home consumption
• Freight or shipping if separately stated on the invoice
• Commercial lease

Use tax is similar to sales tax, in that it is a tax collected in relation to sales made. However, it is differentiated from sales tax in that for sales tax, the primary consideration is whether the sale occurred in the state, while for use tax it is whether the property purchased out-of-state is brought into the state for use, storage or consumption.

The purpose of accounting is to provide financial information that is useful in making business decisions. Accounting information can be used in financial planning, decision making, performance evaluation, and risk management.

When you’re starting a business – Getting help from an accountant early on can save you a lot of time and money down the road. They can help you choose the right business structure, set up your accounting system, and get you started on the right foot.

When you’re self-employed – If you’re running your own business, it’s essential to have a good handle on your finances. An accountant can help you keep track of your income and expenses, file your taxes, and plan for your financial future.

When your finances are complex – Even if you’re good with numbers, there may be times when your finances are too complex for you to handle on your own. If you’re dealing with things like investments, multiple sources of income, or a lot of debt, an accountant can help you get a better understanding of your financial situation and make smart decisions about your money.

When you’re making major life changes – Big life changes often come with big financial implications. If you’re buying a house, starting a family, or going through a divorce, an accountant can help you navigate the financial side of things and make sure you’re making the best decisions for your long-term security.

However, there are a few things to consider before making the switch to remote accounting. First, you need to make sure that your team is adequately trained and equipped to work remotely. Second, you need to have a clear understanding of the benefits and challenges of remote accounting so that you can make an informed decision about whether it is right for your business.

The first thing to consider is the size and complexity of your business. If you have a small business with simple financial needs, you may not need to pay as much for an accountant as someone with a large, multi-national company. Of course, this also depends on the specific services you require from your accountant.

It’s also important to consider the experience and qualifications of the accountant you’re considering hiring. A certified public accountant (CPA) will likely charge more than someone who is just starting out in the field. However, you may feel that the extra cost is worth it for the peace of mind and expertise that a CPA can provide.

At Melanin Tax Solutions, we offer consultations for free to see which of our services fits your needs and your budget.

You’re starting to feel overwhelmed by your finances – If you’re constantly worrying about money and you’re not sure where your business stands financially, it’s time to get some help. A bookkeeper can take the burden off of your shoulders and help you get a better handle on your finances.

You don’t have any financial records – If you don’t have any documentation of your income and expenses, it will be very difficult to track your progress or make informed financial decisions. A bookkeeper can help you get organized and set up a system for tracking your finances.

You’re making mistakes with your finances – Even if you’re good with numbers, there’s always a chance of making mistakes when it comes to your finances. A bookkeeper can help you avoid costly mistakes and keep your finances in order.

You’re ready to grow your business – If you’re planning on expanding your business, you’ll need to have a good handle on your finances. A bookkeeper can help you track your progress and make sure you’re on track to reach your goals.

There are a few key things that small business owners can do to prepare for their taxes. According to some of the experts in tax preparation that NYC has, first, it is important to keep good records throughout the year. This will make it easier to file your taxes and ensure that you are getting all of the deductions and credits you are entitled to.

Second, it is a good idea to estimate your tax liability ahead of time so that you can budget accordingly. This way, you will not be surprised when tax time comes around.

Finally, it is helpful to consult with a tax professional if you have any questions or concerns. They can help you navigate the tax code and maximize your deductions. By taking these steps, you can minimize your stress come tax time and ensure that you are prepared.

When searching for tax services near you, as a small business owner, it is important to keep a few key factors in mind. First and foremost, you want to make sure that the tax service you choose is reputable and has a good track record. You’ll also want to inquire about pricing and compare rates between different providers. Additionally, it can be helpful to read online reviews from other small business owners before making your final decision.

If you are running a small business, the answer to this question depends on a few factors, including the complexity of your business and your personal financial situation. If your business is relatively simple and you have a good understanding of tax law, you may not need a tax advisor. However, if your business is more complex or you are unsure about how to file your taxes, it may be worth considering hiring a tax advisor.

When you’re looking for an expert in bookkeeping near you, first and foremost, they should be highly knowledgeable in the field of bookkeeping and have a strong understanding of all the various aspects involved. Secondly, they should be able to keep up with the ever-changing bookkeeping landscape and have a deep understanding of new software and technologies as they come out. Finally, they should be highly organized and have great attention to detail, so that they can keep your books in order and help you stay on top of your finances. By finding someone with these qualities, you can rest assured that your bookkeeping needs will be well taken care of.

While online bookkeeping services can help you stay organized and on top of your finances, they will not necessarily help you prepare your taxes. This is because tax preparation requires a more in-depth understanding of the tax code and how it applies to your specific situation.

However, online bookkeeping services can help you keep track of the financial information that you will need to provide to your tax preparer, which can make the process easier and less time-consuming.