My uncle Phil and my friend Ashley, both savvy in business and money, have been telling me I need to get an accountant now that Frugal Mama is turning into a small business.
Signs that I needed to get my finances organized? I started making money from writing for other sites, I trademarked Frugal Mama, I was hired to host TLC’s Frugal Mama Makeover series, and I signed on with a lawyer to help me figure out my TLC contract.
My lawyer gave me one contact, but I’d like a few more to compare services and rates. My uncle tells me I also need a CPA, who specializes in taxes. Frugal me is, of course, wondering if I should just buy a book on accounting and do it myself.
One free program I have been using is Outright.com, an accounting website which I also recommended to Kara, who is starting her own dance studio, in Free Tools to Help Small Businesses (video). However, I still feel a little in the dark as to the record-keeping and tax part.
Since a lot of you probably have more experience with self-employment income than I do, can you offer any advice?
In the meantime, I thought you might be interested in these other articles I’ve been writing at Parentables:
Take These 5 Baby Steps to Get Your Finances Organized
5 Reasons to Skip the Yard Sale and Give Away Your Extra Stuff
16 Savvy Ways to Grow Your Small Business without Spending a Fortune
And please do share your thoughts on the accounting thing in the comments. Thank you!
You also might like:
- Readers Answered: How to Find an Affordable Accountant
- Question for Readers: When Does Frugal Become Embarrassing?
- How to Find a Good Babysitter
- Free Ads to Frugal Mama Readers for the Month of December
- How I Avoided our School Fundraiser and Felt Good about It
 |
 |
{12 Intelligent opinions... read them below or add one}
I’m sorry I don’t have anyone to recommend, but I think this is definitely one of those times that if you can possibly afford to hire someone, you really should. Although it is possible to handle the taxes yourself, when I did the research I found concepts like quarterly tax payments, depreciation of equipment, deductions, etc. to be overwhelming. I haven’t yet reached a level where I have to worry about quarterly taxes, but I will definitely be looking for help when I cross that threshold. Hiring somebody will save you time and sanity, so it would probably be a worthwhile splurge if you can manage it. Hope someone can help you find an inexpensive solution!
Jen @ Jen Spends´s last post ..Getting Organized: #GetButtonedUp Challenge Week 1
Hi Jen,
Oh dear, I’m sorry, I thought I already responded to you! I totally see what you mean about the overwhelmingness of depreciation, quarterly tax payments and deductions. And you are right: saving time and sanity is worth the layout in cash. I’m still doing research on this but am getting close to finding the right solution.
Thanks for sending in your two cents! p.s. I am loving your posts about the Buttoned Up Organizing Challenge.
Amy
Well, I’m going to stop reading you now! ;) Never worry about that–I know how busy you are! Thanks Amy.
Jen @ Jen Spends´s last post ..Getting Organized: #GetButtonedUp Challenge Week 2
You were writing the other day about learning to delegate certain tasks — I highly recommend you make this one of them. The time, energy, and positive emotions that you will spend trying to do your own taxes when they become this complicated are not worth it. You’ve got your self-employment income, your husband’s, his other job — it really does get complex, and you can find yourself paying a lot more than you’d like to.
For example, last year, my husband tried to do our taxes on Turbo Tax, despite the fact that we both had self-employment income, plus I had income from another job. We ended up paying nearly $40,000. My brother, a CPA, talked to us about it and we just amended our taxes. We should be getting about a quarter of that money back in about 12 weeks. If we’d let my brother (or my dad, also an accountant!) do our taxes last year, we’d never have had to pay that in the first place.
There are accountants out there (my brother and dad’s practice being one of them) that specialize in self-employed folks like you and me. It’s worth it to use one, in my opinion.
Hi Michelle,
This is so helpful! I can’t believe how much you are going to be able to save using a CPA. That’s so worth the money!
I’ve heard from a lot of people via email echoing the same thing: tax prep and accounting for self-employment income is worth delegating!
Thanks again for your input, Michelle.
Amy
You definitely want to get some help with your business accounting and your taxes. It is not worth the worry, time, effort and possibility of costly mistakes to try to do it yourself. I am sure there are great books and software programs out there, but nothing beats a 30 minute consultation with an accountant that deals with small business matters every day. I am a new mom and a CPA and enjoy reading your blog, so I am very frugal myself. You do not need a high powered (ie high cost) accountant to help you as I am sure you are not dealing with complicated tax issues. I am working part time for an expensive firm, but also am self-employed doing taxes and bookkeeping from home. My goal is to be able to stay home with my daughter, but also contribute to the family budget. I am sure you could find someone like me that would be happy to consult with you and not charge the fees that come with the expensive firm. It sounds like you probably just need some occasional consulting and questions answered during the year and then your taxes prepared at year end. You could maybe even offer a trade situation to a self-employed accountant in your area! But the bottom line is get some help – you don’t want the IRS sending you love notes! Oh, and 2 more cents – get the help sooner rather than later – accountants are anal and like to show you how to do things right from the beginning, not clean up a mess!
Hi Amy,
I really appreciate hearing from you, as a CPA yourself! What you say is very reassuring, also coming from someone who is frugal. CPA fees seem like a lot of money to shell out, but everyone is telling me it is not only worth it, but will probably pay itself back and more. And thanks for the advice to get started now. :-)
Take care and super-big congratulations on becoming a mom!
Amy
Hi Amy,
I agree with your other readers, this is one place to “splurge”, you will save yourself boatloads of anxiety and late nights. Your accountant will likely find ways for you to keep some of the income that you won’t realize you can keep/claim/deduct, etc on your own.
My hubby, my brother and I have all used the same woman for almost a decade. She is fantastic. So down to earth, extremely smart and more than fair with the rates she charges. Rena Pitchess is her name, find her here if you like: http://www.pitchess.com
Good luck – and what a fabulous problem to have. Go you!
-Autumn
Autumn Penaloza´s last post ..Confessions of a Biased Juror
Hi Autumn,
Cool — thanks for chiming in, and for even giving me the name of your accountant! Sometimes when the choices are overwhelming, it’s great to have something to grab onto.
I appreciate it — as well as the moral support.
Take care,
Amy
I am an accountant and almost a cpa. If you can do good bookkeeping yourself then hiring a tax accountant is much cheaper. The less I have to do to manipulate the wrong numbers (to make them right)… The cheaper it is. So my advice… Learn bookkeeping well. Hire an accountant that knows your industry well. Compare prices of three firms with varying sizes
Good luck. If you want, find an accountant to know personally or has a Passion for your business that simply can be your go to question person without charging. It’s good to have lawyer and accounting friends. Some universities offer these services for free to teach their students which is also a more cost effective alternative.
Hi Abbie,
I love all these tips! Coming from someone in the biz, they are especially helpful. I get what you mean about having your stuff organized so you spend less time paying someone to sort it all out. Also, what a great tip about finding a teaching college whose students might do it for free or almost.
Thank you for sharing your wisdom, Abbie!
Amy
{12 Intelligent opinions... read them below or add one}