Prepare to level up your small business finance game. We promise you'll walk away from this episode armed with essential insights, as CPA Michelle Tracz joins us in an enlightening conversation packed with practical advice. We shed light on the importance of year-end accounting tasks and tax preparation, along with the potential pitfalls of neglecting estimated tax payments. Furthermore, we underscore the significance of updating your employee data and planning equipment or software upgrades for the new year.
In the next half, we journey through the critical domains of tax preparation and data backup. You'll discover the immense value of regular consultations with a tax preparer and the essence of strategic budgeting for the year ahead. Delight in the celebration of the past year's victories and explore the benefits of cloud storage solutions for data backup. We wrap up with a focus on understanding your target audience and the pivotal role of cash management in business success. Don't miss this power-packed episode; it's a treasure trove of financial wisdom catered specifically for small business owners. Remember, catch up on previous episodes and join us again next week!
https://www.michelletraczcpa.com/
This program is brought to you by:
Balanced Virtually
Be sure to visit BizRadio.US to discover hundreds more engaging conversations, local events and more.
Prepare to level up your small business finance game. We promise you'll walk away from this episode armed with essential insights, as CPA Michelle Tracz joins us in an enlightening conversation packed with practical advice. We shed light on the importance of year-end accounting tasks and tax preparation, along with the potential pitfalls of neglecting estimated tax payments. Furthermore, we underscore the significance of updating your employee data and planning equipment or software upgrades for the new year.
In the next half, we journey through the critical domains of tax preparation and data backup. You'll discover the immense value of regular consultations with a tax preparer and the essence of strategic budgeting for the year ahead. Delight in the celebration of the past year's victories and explore the benefits of cloud storage solutions for data backup. We wrap up with a focus on understanding your target audience and the pivotal role of cash management in business success. Don't miss this power-packed episode; it's a treasure trove of financial wisdom catered specifically for small business owners. Remember, catch up on previous episodes and join us again next week!
https://www.michelletraczcpa.com/
This program is brought to you by:
Balanced Virtually
Be sure to visit BizRadio.US to discover hundreds more engaging conversations, local events and more.
Welcome to the Veronica Edwards show, where we have fun financial conversations that everyone listening can apply to their personal and professional life. I'm your host, veronica Edwards, and I'm so excited to be back season three on biz radio dot US always want to thank the V team for downloading the podcast we are approaching for K, so thank you guys for helping us reach this goal before season four. And today we have one of my favorite segments. We have our monthly CPH chat with fellow CPA. Michelle Trots, owner of Michelle Trots CPA, cpa CFF ELLC is one of those more Welcome.
Michelle :Why thank you so much?
Veronica :So we were just catching up before we got on air and I was just asking Michelle how she's doing. So if you can share with the listeners a little sliver of your life, what have you been doing since the last time we had our chat and approaching going into our busy season? What's going on with you?
Michelle :Wow, thank you so much for asking it's. It's busy, right. I mean, I feel like we are. We have these ebbs and these flows where, at this time of year, we are really working hard for our clients to really prepare for year end. Just like we're going to talk about today is just all these things that come to mind about what we need to do to get ready, because there's a lot and we want to make sure that we're on top of it. I'm just one of those kinds of people like I'm proactive. I do not like to be reactive, so I want to get ready for year end. So that's what we've been doing focusing on that, helping our clients in so many different ways, and then we're going to hit the ground running right come January one. We all know we have a lot to get done to help our fellow tax preparers and our clients get, get ready for tax season and and then they're off to the races. So that's that's what's been taken up my time. What about you?
Veronica :Yeah, I've definitely been ramping up with a lot of fractional CFO consulting engagements on one time cleanups. Michelle, I've actually been working in wave in addition to quick books, and I just picked up a client that has fresh books, so I don't know if he views that before we've talked about all of these different financial management systems, but I'm definitely, you know, adding some folds in my brain, I'm learning.
Veronica :Learning is good. Learning is great, so let's jump into day into this year in checklist. This show is going to air in December, so we definitely wanted to provide some tips to small business owners for them to be as prepared as possible going into next year's tax season. So, michelle, can you kick us off? We're going to have about five tips that we want to provide for the year in checklist.
Michelle :Yeah, I mean, I think, first of all, if you are a small business owner and you're like, okay, it's November, what do I need to be doing to kind of get ready for calendar year? And and again, we're talking about small businesses that use calendar year and as their fiscal year and you can have a different fiscal year, and which is great. There's still some things, even if you do have a fiscal year and say that isn't 1231. There's still some things you want to get ready for for 1231, like the IRS is still on a 1231 kind of schedule in terms of 1099s and those kinds of things. But you can, your business can be on a different fiscal year and which will drive when that business tax return is done. But if you don't have a separate tax return for your business that you file maybe say you're a sole proprietor or single member LLC, you know of course you're you're going to be on that calendar year and so, as we're in November and we're thinking about it and getting into December, approaching the year, and we're just like, okay, what do we need to be doing to get ready for this year? And and and there's a lot of things that I would recommend you make sure that you've got on your to do list, and one of those things is just making sure all of the accounting for your organization is updated, is complete.
Michelle :I've been working with a couple of clients that you know the summer, you know kind of put things behind and they were making their money in unification and whatnot. So they got they got behind on their bank reconciliation is, for example, that's. That's one of those things that you never want to not do like. You should be always doing bank reconciliations and, of course, I recommend you should be doing them monthly, because if you can catch an error or a mistake or something, even regarding the bank making an error, then that's always important to catch it as quickly and as early as possible. And so you wanna make sure you stay on top of those bank reconciliations. I don't know about you, but I have clients who'll say to me oh, but you know, I use QuickBooks and all my bank transactions download, so I don't need to reconcile. Well, that's not necessarily true.
Michelle :You still need to reconcile your bank statement. Hopefully, the AI that's embedded in QuickBooks and into it that they use to make sure everything does flow through between the banks and your accounting system. Maybe, hopefully, they captured everything, but you still wanna make sure Wanna make sure it captured everything correctly. Wanna make sure your bank also captured everything correctly. So making sure you're caught up on all of your reconciliations. Making sure you're caught up on all of your take a look at your invoices, your contracts. What do you have outstanding with your customers? Where are we?
Michelle :As we approach the new year, a lot of times people will have their contracts or invoices, whatever kind of renew or re-engage January one.
Michelle :So it's a good time to kind of take a look at it. Maybe you might want to change the terms of your contracts or your invoices, so you might wanna start thinking about that. So thinking about all of those things and then also making sure that you have all your W-9s ready. So maybe for season we're getting ready for those 1099s. We gotta hit the ground running, like I said on January one. So getting those W-9s if you haven't already done so. Again, I say it like that because I tell my clients best practice is get a W-9 from every one of your contractors before you even pay them the very first time. Then you don't have to do this mad race in December to get the W-9s from them when they may be hard to reach. So those are just some of the things you wanna kind of get geared up for and be thinking about in terms of starting off the new year properly and getting a good hearty close on this current fiscal year.
Veronica :Totally agree. And to piggyback off of that, michelle, making sure that your books are up to date is necessary to do tax planning, and that's something that I didn't realize until I started a small business. I'm gonna be six years old in January, so I'm saying now that I'm running a little bit, I'm not crawling anymore. I've been learning a lot about tax planning and I think even me personally, I didn't do that, so I didn't realize how important it is, now that we're in the fourth quarter, to be proactive and you still have time, because it's not December 31st that you can possibly purchase some things that can lower your tax liability or start saving for taxes or find out hey, I might not have to pay in taxes, but I definitely recommend for you to talk to your tax accountant in that quarter.
Veronica :I know this is airing in December, but you still have time to affect your bottom line and it could make a huge difference when it comes to your cash flow going into the new year. So I definitely am working on that now, michelle. I, too, have clients where I got a little bit behind because they were out of town. Then I'm out of town, so that's what I'm currently working on with clients. So you hit that right on the head with making sure that you're caught up on the bookkeeping, which then would allow you to have proper tax planning. So, michelle, what else can we do for our year in checklist?
Michelle :Yeah, I mean one of the quick things I wanted that I wanted to add to tax planning I think you kind of alluded to it which is getting a tax preparer, that is, that's your tax specialist. And so a lot of people think about tax preparers this time of year when they're getting ready to prepare their tax returns. And, yes, that's in a very important process that a tax preparer does for you, and we love our tax preparers. We wanna make sure that they are the ones preparing our tax returns properly, accurately and getting the best deal for you, so to speak, right Within the confines of the laws. Which advantages are you missing and are not taking advantage of that? You should be. So we want those tax experts to be on your team as well.
Michelle :If you're a small business owner, but let's make sure to your point, talk to your tax preparer multiple times throughout the year. You should be right. They should be providing tax planning, tax advising, tax guidance. There's multiple times throughout the year where a tax consequence may come up and you should be talking with that tax preparer. So I always tell my clients it's kind of a three-legged stool. It's the business owner, it's having a good business accountant and consultant on your team, like myself or like you, where we can help you throughout the year making sure everything is being reported correctly and properly and consulting and advising you. And then you've got the third language, that tax legs. So just making sure to reiterate your point about it's not just a one-time thing get with your tax repair multiple times throughout the year and have them help you from a tax consequence perspective.
Michelle :So the other thing, though, in addition to that, is just really thinking about you know, as you're ending a year and starting a new one, maybe making a budget, setting a strategic plan, what are you going to be doing? You know it's a really I love this time of year for my business because I get to look back on the whole year. It's hard for me, I don't know about you, but to look at it, you know halfway through the year and you think, okay, well, that's great, that was that first half, but things could change. I don't really have a huge crystal ball. I have a little one.
Veronica :I don't have a big one.
Michelle :I kind of know what is going to happen in the last six months of the year, because I've done my strategic planning and my budgeting already for the year, but things could change. So now that we're at the end of the year, I love it because I can look at the whole year's actuals. I love playing in actuals. You know, here's exactly what happened. Here's where I spent money this year versus last year. I love that.
Michelle :Looking at you know the analysis year over year of like, okay, well, I did this last year, I did this differently this year, so what am I going to do next year? How do I want to affect or impact my organization financially in the coming year? This is the time to make those plans and the way you do that is looking at a budget, making sure you've got good financials, comparable year over year, to start making those those plans, looking at it, making a forecast, and it really does help you focus on what it is you're going to be doing in the coming year, setting that that foundation, laying the landscape, if you will, and that's super important.
Veronica :I find it's really helpful for my clients absolutely, and you know, with us being accounted for analytical already, so I'm with you.
Veronica :I get excited even once we get nine months in the year, because I know I eat well, well, we get a quarter and then I'm like, okay, halfway now I can kind of project, but definitely that's the reason why we say, by q4 you've had nine months of actual. And another thing that is good for small business owners to look at at this time is let's look at the wins. What do we do well this year?
Veronica :you know, a lot of times people like I don't want to look at it. It was a bad year. There has to be some positives that you can find, especially, we know we're in an inflationary market, we know that it's hard to get good workers and you know turnover and all that stuff, but at the end of the day, there's a lot of small business growth. You know, that's all that I'm seeing is that more people are moving into entrepreneurship. So make sure that you're sharing those wins with your team to keep them motivated going into the new year yeah, precisely.
Michelle :Yeah, I love that analogy of what is the wins, because that's that implies kind of like the you know atmosphere, the weather, what's happening in the environment that we exist in, either locally and statewide as well as federally, and kind of just understanding the, even the political landscape. What might be happening politically that's going to impact my business for the coming year and it could have dramatic impacts or it could have no impact, you never know. But really taking that assessment of what's out there, what's happening in the environment, so I love that.
Veronica :Yes, so let's move on to the next year and checklist item, which is backing up your data. So, michelle, this is one that I wanted to speak on, because I'm personally experiencing this now.
Veronica :So, I'm transitioning from. In addition to having my business, I'm a controller for a nonprofit here in Western North Carolina and I'm going to be leaving that nonprofit at the end of the year. While I was using their computer and so I'm now transitioning everything to a new computer. But this is the first time I'm so proud of myself that I'm backing everything up to the cloud, not doing the removable hard drive, all that stuff. But you know, now in business with working remotely, you know, traveling there's so many things that's changed, especially since COVID. I really recommend using cloud storage solutions for things that you do in your business because, god forbid, a tragedy happens and your items get burned or destroyed. They're backed up. You know, in the cloud and I know some people like I'm nervous. It's confidential information. I don't want to put that out there, but it's 2023, I hate to say it.
Veronica :If you bank in the United States if you're on social media, your information is out there you know, but it is secure to put things like in Google Drive and you have Dropbox and different cloud storage solutions. But this is the time to try to organize all of that. Make sure that you have a process that you, if something did happen, you're backing your items up regularly to where it's not going to stop business operations.
Michelle :So true, I'm sure this does not come as a surprise to you, Veronica, but as an accountant I'm sort of over the top right.
Veronica :Do tell, Michelle do tell.
Michelle :I not only use cloud storage, but I also still use a portable hard drive as a secondary backup. Like I'm like I'm like an insurance salesman's dream I want to protect everything from the catastrophic. What if, like I don't like unpredictability? Huh, shocker. It's our personalities, but I definitely want to share.
Veronica :What really got me was I had a boss like probably a year ago with this job that I'm transitioning from and he was out of town in California and they broke into all the vehicles is like one of the richest zip codes in the United States and so sometimes I think people get comfortable. He left his book bag, his passport, his computer all that in the car. It was locked but it was what they call like a smash and grab, like they just broke into all these vehicles. But he had everything backed up. But my heart dropped because I said if that happened to me today at that point in time I would have lost a good amount of my information. And Michelle, me and you both know like our business is on our computer, so if something happens to our computer we're kind of screwed.
Veronica :So that really woke me up a year ago. And now, transitioning to a new device, absolutely Everything. I think I have it backed up in two places also, but I definitely recommend to my clients Google Drive. That's what I use for them to upload bank statements and permanent files and different confidentiality, so we can share it and we can have easy access to it. And it's not just stored away in a file cabinet somewhere in Western North Carolina.
Michelle :Oh, for sure, For sure, absolutely. And you know, for our clients, we have client portals that allow us to exchange and share information between us and our clients very securely and safely. And it also is a it's a Microsoft Office product, so we are able to access that data through the internet, through the cloud, and it's backing it up and it's storing it and it's retaining it. So it's really, you're right, it's really important. It is 2023 and there are so many things that I think people don't even realize that they're already doing, and cloud storage is one of them, and AI is another one.
Michelle :Like everyone's freaking out about what is AI and where is it going to be To me and my business and all the things. Well, it's already here. We've been using it for a really long time and I don't think we even really realize it In what capacity we've been using it, and now it's just taking it to the next level. So it's just so interesting. But you're right, backing up your data and especially now, at the end of the year, it's just a good time to check and just say, yep, everything's backed up, I have my subscriptions renewed, I'm ready to go, I feel comfortable, and so then I can hit the ground running for the new year, for sure.
Veronica :Michelle, you just gave me a possible topic that we could talk about AI in the future, because I am seeing it pop up on Zoom everywhere. We're using it for the radio station. It's been amazing, so that might be a topic for 2024. So, michelle, what is one of the last year and checklist items we wanted to discuss today?
Michelle :Yeah, and so this one is interesting for us CPAs to kind of put on the radar for our listeners. And that is really thinking about your marketing strategy, your clients, your customers. Like, what are you doing and how are you going to be approaching them in the new year? And again, because we're accountants, it's not something that we dabble in, we don't play in this marketing sort of customer space, but you and I both are business owners and we work with other small business owners and we don't want people to forget.
Michelle :This is also a really good time of the year to be thinking about it.
Michelle :Like, what are you going to be doing in terms of your pricing?
Michelle :What are you going to be planning in terms of maybe it's a good time to refresh, to rebrand I mean, veronica, I'm going into 12 years of running my own firm and I love my logo and I love my brand and it's super identifiable but maybe it is time for a refresh and maybe I need to be thinking about those things as I'm planning my budget, as I'm putting that budget out there, maybe there's some additional costs I need to make sure I budget for if I'm going to rebrand, or how are my customers coming to me.
Michelle :So as I'm thinking about my budget, I want to be thinking about my revenues too. What incoming in-stream of revenues am I going to have, and is that going to be the same as it was last year? What customer acquisition techniques do I need to employ in the coming year to keep that stream coming? Or do I need to approach a different customer group? You know, maybe I need to think about doing different work in different capacities. To your point, maybe I need to start working with other organizations to do some consulting or some advising, so to speak. Maybe I need to hire some more accountants on my team to provide more basic accounting and bookkeeping services, because maybe that's what I'm seeing in the tea leaves that clients are going to want.
Michelle :Or maybe I need to make sure I'm hiring more CPAs on my team because, I'm seeing the tea leaves that our small business clients in the community are going to need more CFO or fractional controller CFO services. So, really evaluating your sales channels, your customers, where is all that happening? What do you need to do to market your business and what do you you know that relates back to brand and what do you need to do to budget for those, for those incoming costs and things that you need to be doing in terms of just marketing strategy and planning for the coming year?
Veronica :What do you think? That's all good stuff and I totally agree. I think a lot of times people get so busy they neglect, kind of taking a pause and let's evaluate how's everything working. Should we look over the website? Check web traffic? Do we need to rebrand, like you said? Is this our target audience?
Veronica :I'm kind of shifting as well. I was sharing with Michelle. Now I'm moving more into coaching and consulting. At one point I thought I wanted to do more bookkeeping. So you're always going to evolve and I'm half the age of Michelle. I'm six years old and Michelle's approaching Tony. So I'm trying to be like her one day and be a cool preteen.
Veronica :So I am telling myself this as well as I'm telling customers, like, don't get too comfortable, because especially you can have one big client and they leave or something happens, and now you kind of have to look totally at the strategy of your business. So take this time before you go into a new year to really just focus on who is our target audience and let's make sure that the cash doesn't run out, because we know small business cash is king. Absolutely, cash is king. Yes, michelle, we're already to the end of the show. Thank you for another great year 2023 is the highest in downloads that we've had thus far in season three, so I want to thank you for being a huge part of that and I pray that you continue to work with me in the future.
Veronica :And I want to thank you, thank you, and I want to thank all of the V Team, the listeners, for tuning in to bizradious. Please come back next week, same time, same place, 10 AM on Wednesdays for the Veronica Edwards show. And if you miss any of the live airings, you can listen to prior shows at VeronicaEdwardsBuzzSproutcom.