Colorado Accounting Frequently Asked Questions
Full-Service CPA, Accounting, & Consulting Firm
Accounting is not everyone’s specialty – and most people would prefer to hand it off to someone else, provided they are willing and capable of running the numbers and bookkeeping!
That’s why outsourcing a Colorado accounting firm – skilled in financial planning, bookkeeping, tax prep, and more – is so convenient. You can focus on the things you’re most passionate about, and we can help manage the fiscal elements behind the scenes.
The following list of FAQs is a great resource for someone considering a Colorado accounting partnership.
Take a look below and don’t hesitate to get in touch with any further questions!
Q: What is the difference between a tax deduction and a tax credit?
A: While both of these are helpful, they function very differently! A tax deduction reduces the amount of taxable income, while a tax credit directly reduces the amount of money you owe in taxes.
With a tax deduction, you are simply decreasing the amount of money you will pay taxes on. For example if you made $50,000 per year, you’d be in the 12% tax bracket. However, a standard tax deduction of $12,550 would take your taxable income down to $37,450. As a result, you would only be taxed on that amount. You may use itemized deductions instead, but the effect is the same.
A tax credit, on the other hand, would simply subtract a certain amount from what you owe in taxes. So, if you get a tax credit of $1,000, you will pay the IRS $1,000 less.
Q: What receipts do I need to bring for my personal taxes?
A: Even if you don’t own a business, there are many types of receipts you should keep for tax purposes. You should keep receipts of medical expenses, for example, as well as for childcare. Depending on your circumstances, there may be numerous receipts that will help you get the best deductions.
When it comes to receipt documentation and Colorado accounting, it’s always better to be over-prepared than underprepared. If you have any questions about specific records or receipts, feel free to give us a call at 970-378-4830.
Q: What documents do I need to bring to my tax appointment?
A: The reality is that every taxpayer’s situation is different. Some taxpayers have W2s and some don’t. Some have investments. Some have businesses. Some have all of the above.
If you receive a tax document of any kind, it is generally a good practice to share it with us in the event that we need it for preparation or if we need to bring something important to your attention.
Q: What are the benefits of hiring a bookkeeper?
A: The list could go on and one, but we can sum it up in four words: it saves you time. As a business owner, outsourcing a Colorado accounting firm to bookkeep will free up your schedule, so you can focus on more important things.
Bookkeeping can become a very time-consuming process, especially as your business grows, and the transaction volume begins to match that growth. Time spent working on the bookkeeping is time you could be spending earning more revenue for your business. That’s why it’s not a bad idea to invest in a bookkeeping service, so that a trained professional with a keen eye for accounting can manage the back-end work for you so you can focus on your business.
Q: Besides tax preparation, how can an accountant help me or my business?
A: While important, tax preparation is only a small part of what accountants do. Here at Yeater & Associates, we offer a myriad of services including Colorado accounting and bookkeeping, business consulting, controller and CFO services, and payroll services. Essentially, we can help you with anything involving finances. And outsourcing these services can be a great options for small business with room to grow!
Q: Which accounting software is best: Quickbooks, Xero, or Freshbooks?
A: Because these bookkeeping services for small businesses were all created with functionality and user-experience in mind, you really can’t go wrong with any of them! We’ve outlined some the specific features for each one in our blog post to help you decide.