1099s review can start TODAY!

Oct 03

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1099s review can start TODAY!

By Info Books LA | 1099, Cloud Accounting Option and Reviews, Procedures, Uncategorized

Counting today, we are only 79 DAYS away from the 1099s filing deadline (box 7).

Therefore, it is much better to be prepared and ready, than to wait for the deadline, which is never a good idea!

So, Quickbooks Online finally opened up the review option for the current year. Just last week we were only able to view last year’s 1099’s reports. But, as of this month, we are now able to review the current year, and get ready ahead of the time for the upcoming tax season!

To review your 1099s, Go to your Quickbooks Online (QBO) file, and navigate to (1) Expenses > (2) Vendors > (3)Prepare 1099s*

(3*) One button is housing two other options, and if you don’t see the “Prepare 1099s” option, then click on the down error next to the “Pay Bills” or “Order Checks’ and you will be able to see Prepare 1099s option*

On the very next page, you will be able to read more about the 1099s filing, deadlines, and read through FAQs. It is a very good idea to read through at least once a year:

.

On the next page you will be able to review the following:

Name of the company, business address, and Tax ID

2. Review, add or modify accounts that are currently checked for the 1099 reporting. Here you can also make sure that the correct accounts are marked correctly ( i.e. Legal Expenses are not marked in the Nonemployee Compensation group.. etc)

3. View the list of ALL vendors and confirm that all 1099’s vendors are marked to be tracked. Also, it is a VERY GOOD IDEA to add emails for each contact as the email delivery of the 1099’s forms can be 1/10th of the cost of the snail mail delivery of the 1099’s.

Make sure you do have:

W9 from any vendor, regardless of the amount you have paid the vendor in one year!

4. It’s now time to preview (review) the 1099s

Pay attention to:

The correct year is selected!
Gather the missing information for the vendors listed in red
Review the amounts in boxes
Review why there is a difference between the ALL PAYMENTS and the BOX (that was reported) (if any

Books LA is jumping on the review for all of our clients! And so should you!

We can never be too prepared.

Tips:

Ask for a fresh W9 every 3 years. It is always a good idea to have current W9 as the addresses, entity types or DBA names can change.
Obtain a W9 regardless of the amount! NO exception. Why? Besides many other reasons here are two very important ones:
- Failure to report 1099 for the lack of W9 can result in the 28% in backup withholding, plus penalties, plus interest! That $1000.00 expense that was a good deal is now costing you $280.00 +( pen.+int%) * years!
- Vendor received less than $600.00 this year, but the next one he receives over $600.00. A few months later it’s time to do 1099’s and the vendor is MIA. They got their money, and don’t feel its urgent to comply. What do you do? Refer to the previous bullet point, and be ready to pay!

So, GET THE W9!!!!

Happy Tax Season (almost)!

Feb 21

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Ever wondered how much does it cost to hire an employee?

By Info Books LA | 1099, Procedures

We are often asked what is the difference between the Independent Contractor and em employee. Often times employers are turned off by hiring an employee due to the cost. However, engaging an independent contractor that is actually classified as an employee can we very costly and usually involves additional audit, accounting and sometimes legal fees when addressed the misclassification few year later.

Our partner Gusto wrote a really good article about the difference an how to classify to either a new hire or a new contract.

The main difference is :

An employee:

Works at a specific time and place set by you, the employer

Generally works for just one company

May receive training

Uses your tools or other work-related resources

Is subject to a large degree of control by you

Is generally paid a salary or hourly wage

Why does it matter? Because employees…

Often receive employment benefits

Are subject to financial deductions such as income tax and Social Security tax, among others

May join a union

Are often protected by state and federal law for overtime and employment discrimination issues

An independent contractor:

Can work whenever and sometimes wherever they’d like

Can work for multiple companies

Usually trains on their own

Uses their own tools and resources

Controls their own method of work

Is often (but not always) paid by the project or on a flat-fee basis

Why does it matter? Because contractors…

Do not normally receive employment benefits

Pay their own self-employment tax and are not subject to other withholdings

May not join a union

Generally do not receive overtime or protection for employment discrimination

So regardless of the cost, the businesses should always follow the rules and the law, when determining the difference.

Employee Cost Calculator by Intuit

However, if you are just wondering what would be the cost alone, here is a really cool tool that our partner Intuit created to help us along.

Employee Cost Calculator

With this tool, you can plan better, and have a very good idea how will the new hire effect your budget. But the decision if you should hire or contract out should be made solely based on the type of the relationship, and not on the cost!

Jan 12

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Bitcoin Accepted!

By Info Books LA | App Review, bitcoin, Cloud Accounting Option and Reviews, cryptocurrency, Document Management, payment processing, Procedures, ScanSnap

We are often asked what is so different between us and other bookkeeping companies.

From the outside, it would appear that we are all similar. At the end, all bookkeeping companies should be able to provide the same service; providing financial reports, bank reconciliations, payroll service and so on.

Only when we start to dig into the process of how we do things at Books LA, we then are able to make a clear separation from the /most of the/ other companies, and us:

We are paperless, which would not be possible with our best friend Hubdoc! Statements (with checks written AND checks deposited), utility bills, service industry bills and statements… All are beautifully auto-fetched buy a bookkeepers best friend Hubdoc!
No one likes receipts. And the fact that most receipts in recent years are produced on a thermal paper only makes recordkeeping more difficult when we stumble upon the old receipt, a cash receipt, forgotten in a car that lost its data completely as it appears to be a piece of a dark-grey-greenish-color paper after being exposed to the Sun… Or the receipt is that is buried somewhere but the ink is barely visible after a year… We have two solutions:
- we request that receipts are sent as images, right away. We request the clients to take the phone out, snap a picture of the receipt with a Hubdoc or a Receipt Bank app, and forget about it. The receipt is captured and stored in the cloud!
- Use Fujitsu ScanSnap ix500 scanner and scan all receipts. This amazing scanner will capture an image and will send it directly to Hubdoc or other destinations where we can easily retrieve it and use it.
We provide access to any required software (QBO or Xero, Hubdoc, Receipt Bank) at no cost to the client. Because it just makes sense for all parties involved.
We reconcile our client’s accounts on a weekly basis – regardless of the size.
We require once-a-month meeting with a client. Via Zoom! Why? Because why waste time in traffic when we can share the screen, talk, and record the session if necessary, and provide the tutorials, and do that all while being most productive.

And then, there is another way we are different – we accept Bitcoin!

For a while now Quickbooks Online has been offering an option to accept Bitcoin as a form of a payment. However, it wasn’t until recently that we have actually enabled that option.

Now, since the technology is new, the allowed daily/yearly limits are still not at the desired level. But the more of us use the option, the faster adoption is bound to happen.

PaidByCoin enabled in Quickbooks Online

So, when asked why do we accept Bitcoin, here is why :

Option is available
It’s a form of a payment
It is exciting to be an early adopter of the future and what is to come
It is exciting to get paid
We absolutely understand the risk and a possible reward…
Why not?

Accepting a Bitcoin as a form of a payment is just another method of getting paid for our services. Hopefully, in the near future, we will be able to accept the other cryptocurrencies, but that option is up to us – yet!

As of today, the Quickbooks Online has only enabled two payment processors; Coin base and Bitpay.

Coinbase is currently not accepting new applicants for a merchant account, but BitPay is.

Quickbooks Invoice Payment Portal

On the other hand, when paying an invoice sent from Xero, and if the Stripe merchant account is enabled, there is an option to turn-on the ‘Accept Bitcoins’ from within Stripe. This option is not enabled with Xero, rather through Stripe alone. That option is absolutely fine as well!

Stripe – Payment by Bitcoin Enabled

There are other options to accept Bitcoin as a method of payment, however, those are STILL not fully integrated with Quickbooks Online or Xero yet (unfortunately)

So next time, when you receive an invoice from Books LA, please remember to never print an invoice ( save a tree, use the cloud), and please pay us via ACH or Bitcoin.

It saves time, saves trees, increases productivity, decreases errors… and why not?!

Feb 08

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ScanSnap and Hubdoc are in #LOVE

By Info Books LA | App Review, Cloud Accounting Option and Reviews, Document Management, Procedures, ScanSnap

ScanSnap iX500 and Hubdoc – are now seamlessly integrated

We received a call today from a potential client; a law firm, looking for a new bookkeeper since their bookkeeper is retiring. Like with any other call, we asked them for the overview and a roadmap of the current process they have with their bookkeeper.

Currently using QuickBooks Desktop
Bookkeeper is working from their office
When she is not, they send her the documents via mail (not email!), she works on the files and send those back to the law office
They are using Bill4Time software (yay!) but it’s not currently linked to the QB file

Three years ago, I would have contemplated to take over the same workflow and would have thought that I am doing my clients a favor for not changing their rhythm.

Integration between ScanSnap and Hubdoc is what we were waiting for!

Instead, we have talked about what we can now do with the available technology:

We can move the company file over to the QuickBooks Online. We like QB Desktop a lot but are supporting QBO and Xero only because:
We can work offsite, not using their office space and being way more efficient by not ever being stuck in LA traffic.
Because now we can scan the files with one touch to Fujitsu ScanSnap and send it straight to Hubdoc – so no file will ever leave the office, but it would be accessible in cloud and searchable by CTRL+F
We would connect the Bill4time directly to QBO for a seamless and easy reporting.

Just a week ago, I wouldn’t be able to recommend this seamless workflow and offer such a convenience that we can offer today. Just a week ago, we used to scan all our documents to ScanSnap Cloud and then drag+drop the documents to Hubdoc. Now that has changed since ScanSnap and Hubdoc are in LOVE!

ScanSnap: We love our ScanSnap iX500!

A few months ago, we posted a blog on our website with a story of moving our entire HON 4 drawer lateral file cabinet to the cloud. Just imagine how much easier the life would be if you could search all your files with CRTL+F = ALL! Well, we can! And it’s an amazing time saver!

Yes, scanning the files with a regular scanner might seem like a good idea. However, scanning with a regular scanner will make your files readable. But could those files talk as well? No!

Using the ScanSnap scanner your files will talk! Yes, talk! With many, many programs and tools that are accessible now. How? Well, ABBYY USA Technology is now part of the Fujitsu ScanSnap

So files are scanned perfectly – regardless of the shape and size, and are easy to read!

Hubdoc: We love Hubdoc!

Books LA was included in this prestigious list for the second year in the row

It is not a secret that we LOVE Hubdoc! Books LA is a hard-core fan, groupie even, of a Hubdoc. Besides the fact that the whole Hubdoc team is probably the best there is, with a super friendly and knowledgeable staff who are always super happy to help, Hubdoc SOLVED our problems

Since January 2015 using Hubdoc became a requirement for any of our clients.

If things could get better – they sure did!

Last week it was announced a ScanSnap and Hubdoc integration! AND IT’S A MUSIC TO OUR BOOKKEEPERS EARS!

ScanSnap is the best scanner out there: Review of ScanSnap at Lawyerist.com

ScanSnap + Hubdoc = #LOVE

That law office client that called today, we can simplify the workflow.

By having a ScanSnap scanner, they can easily scan all the necessary documents over to Hubdoc – DIRECTLY! Because the scan quality is superb, the Hubdoc can easily OCR the whole document, and easily extract the name, date, amount, type… And Hubdoc will file the document in the appropriate folder; one vendor- one folder.

From Hubdoc we can easily ‘push’ the documents over to QBO or Xero. That way we can attach the PDF, .jpg to a transaction and have the backup readily available in the QBO or Xero, and email the backup along with the invoice.

And it’s that simple!

With ScanSnap scanners your documents will talk + Hubdoc will listen and understand = jointly both will seamlessly communicate with your accounting software ( Quickbooks Online, Xero, Sage. Intacct..)

This is a marriage made in heaven!

Setup is super easy!

Step One: During the Setup select Hubdoc from the offered cloud storage options

Step Two: Login to Hubdoc with your credentials

Step Three: CONNECTED!

#Done!

Dec 29

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Meal and Entertainment – Travel meals – Employee meals – Office parties

By Info Books LA | Dining, Procedures, Uncategorized

What is the difference? Is there a difference? Why does it matter?

Mike Russo, from Less Taxing Services, LLC wrote a good, entertaining and clear guide when in comes to meals and the deduction parentage.

“When I talk to clients about the need for professionals being involved in their finances, I describe a box of donuts.

That simple box of donuts can be coded 10 different ways (another group came up with 11 or 12, but I can’t find that list…some of them were WAY off the wall, though, so we’ll stick with 10). Once coded, the donuts could then show up on at least 7 different tax forms. (Schedule C, 1120, 1120S, 1065, 990, Form 2106 and Schedule A)

It’s never as simple as just buying a box of donuts.

– No Deduction – I buy a box of donuts and eat the whole thing while in town at my tax home. (Note, this would be 50% deductible if you were out of town traveling for business.)

– 50% Deductible Business Expense – I buy a box of donuts and share them with the 10 people in my first sales meeting of the day

– 50% Deductible Non-Reimbursed Employee Expense – Same as above, but now I’m an employee and my employer requires me to supply food in my business meetings but doesn’t reimburse me for it. (While this is still 50% deductible, it’s an itemized deduction and won’t even begin to count until you’ve crossed the threshold of 2% of your income.)

– 100% Deductible Business Expense – I buy a box of donuts, takes them to my first sales call and leave them in their lobby by the coffee for all to enjoy…even people off the street.

– 100% Deductible Non-Reimbursed Employee Expense – Same as above, but now I’m an employee and my employer requires me to supply food in my business meetings but doesn’t reimburse me for it. (While this is still 50% deductible, it’s an itemized deduction and won’t even begin to count until you’ve crossed the threshold of 2% of your income.)

– 80% Deductible Business Expense – I buy a box of donuts that I use as breakfast and lunch while driving my big rig across the country. (I’m subject to DOT rules.)

– 80% Deductible Non-Reimbursed Employee Expense – Same as above, but now I’m an employee and my employer don’t have any provision for meals while I drive. (While this is still 50% deductible, it’s an itemized deduction and won’t even begin to count until you’ve crossed the threshold of 2% of your income.)

– 100% Deductible Personally – I buy a box of donuts and donate them to the church bake sale. (This is deductible, but it’s only on the personal return…even if you did this for a Corp, it would still pass through to the shareholders and wouldn’t be deductible at the corp level.)

– 100% Deductible as COGS – I buy a box of donuts to resell.

– 100% Deductible as an Ordinary and Necessary Business Expense – I buy a box of donuts to use as a prop during a tax talk where I discuss the ways a box of donuts can be coded. 🙂

Now, who wants a donut? :)”

The 33 Best Donut Shops in America –Huffington Post

Oct 31

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Are you ready to file W-2’s and 1099’s by the new deadline?

By Info Books LA | Procedures

Upcoming changes – Deadline to file 1099’s and W-2’s

Did you know that beginning with 2016 forms, the employees must file by a new deadline?
– W2’s is to be filed by January 31, 2017 – e-file, mail, employee copy, agency copy… Regardless! The forms are now due by January 31, 2017. Simple as that!
– Deadline to file 1099’s is changing as well, but not for all filings. If your business will be filling a 1099’s and reporting amounts in BOX 7 (Nonemployee compensation) – the new deadline is also January 31, 2017 – -e-filing, mailing, recipient – deadline for all is January 31, 2017. However, 1099’s with no Box 7 reporting are still due by February 28, 2017 by mail, or March 31, 2017 by e-filing

Solution:

– Have your books updated and completed by the end of the year, and be ready for the deadline in January 2017. It’s always a good idea to update the financials on monthly basis. By updating the books on the regular basis, you will have a way better understanding of your business performance and can plan your future success.
– Use payroll service. We highly recommend Gusto. With a very reasonable monthly fee your forms will be distributed and filed on time. No need to stress.

Intuit published and article on this subject :

Beginning 2017 IRS changes W-2 & 1099 filing deadlines

Tax season is upon us! Let’s get ready!

Procedures