It's our goal to have your prior month’s bookkeeping reports completed by the 15th, or the business day prior.

Ideally, we will have accountant read-only access to all of your bank accounts so we can download statements on your behalf. 

We aim to email any questions we have on the bookkeeping sent to you as early as possible.

Your timely response allows us to turn your books around by our goal date of the 15th of each month.

Delayed responses lead to delayed reports.

Please do your best to answer promptly so we can ensure timely reports so you can make better business decisions.

Delays:

If reports are delayed beyond our internal goal deadline of the 15th, we will send a status update. If the reason is due to incomplete information from the client, we will let you know what is missing.

Once this status email is sent, we will be waiting for your response with the information necessary to complete your books.

The first half of each month is when we are laser focused on our clients and getting their reports turned around. 

We strive to reply to any email communication within 24-48 hours, but please understand that there are some busy times of each month that may take us a tad longer.  

Please send us an email to alert us if you:

• Open a new credit card or bank account
• Change banks
• Begin selling physical products
• Hire any new staff
• Apply for or receive new loans
• Accidentally pay a personal expense from the business
• Accidentally pay a business expense personally

Our rates are based on a combination of your annual revenue as well as the time it takes to complete your books.

Rates are subject to increase with written notice and upon your acceptance. In the event of an increase, you will be notified of the amount and the date it goes effective in advance and with your consent.

We dislike busy work, so most of the time, we will be happy to brainstorm ways to work faster and keep your bill down. To make that work, we need your flexibility and willingness to implement efficient systems.

However, we do understand when the priority is in maintaining your system and dealing with the inefficiencies on the books. And we're open to doing that work, but absent an efficient system, the bill is subject to increase and we will discuss the increase then.

Things that can trigger rate increases, aside from general inflation, are:

• manual processes (example: keying in each transaction versus a bank feed, coding items of income one at a time in a separate platform)
• increases in volume of transactions that adds time (sometimes an increase in volume doesn't add time)
• granular detail of reporting (example: showing you detail by project or division)
• an increase in how many accounts you have
• management of inventory, payroll, or sales tax

Mixing business and personal expenses is a big no-no when it comes to accounting and should be avoided for several reasons.

When business and personal transactions are kept separate, it makes it exponentially easier to maintain the books. That means fewer questions, less guesswork, reduced room for error, and time saved which means a lower fee and higher accuracy.

Keeping them separate increases the integrity of your books and really helps you in the event of an audit.

You should pay only personal expenses from your personal accounts and business expenses from your business account. If cash is tight on either side, transfer between accounts.

PayPal

If you use PayPal, you should have a separate profile for business and personal. Your business profile should only be linked to business accounts. You can edit this in PayPal under Pay & Get Paid > Banks & Cards > and then delete any accounts that are not business.

If you accidentally pay a personal expense from a business account:

We will typically categorize it as owner's draw and it will not count as a business deduction. If this is a transaction on autopay,  please correct the billing account to your personal account.

If you accidentally pay a business expense from a personal account:

We have no way of knowing unless you tell us. That means you miss the ability to deduct what you spent... which is not good!. Make sure you send us an email letting us know the date, amount, and vendor and we will enter it in your books. You can also reimburse yourself by writing a check or transferring from your business to your personal checking with a memo and telling us it is a reimbursement. If you don't tell us this was done, it may accidentally get categorized to owner's draw which means you miss the deduction.

We kindly request you keep this to a minimum as it creates more work and an inefficient process with lots of room for error.

Fun Fact: estimated tax payments and payments on your personal tax return are actually personal expenses and are not deductible. If you pay them from your business we will treat them as owner's draw.

As your bookkeeper, we don't manage your receipts and we usually don't ask for them, with a few exceptions for large transactions.  

Receipts are a client responsibility and used to back yourself up should you ever get audited.  Keep all receipts when paying cash or when the transaction is over $75. The IRS allows you to use your bank statement for purchases under $75.

How to store receipts

Create a separate folder in your computer files for business receipts.  

Name each receipt when saving so you can reference them back easily in the case of an audit.  A good naming habit to get into is something like “Date Vendor Amount” for example: 2024-01-05 Amazon 86.42.pdf.  It will automatically be sorted by date, then vendor, then amount and make it easy to find.    

For paper receipts, scan them with your phone to save to your business receipts folder and then toss the paper receipt in the trash.

Determining if a new hire is an employee or contractor is not a choice. It's a matter of which one the IRS would determine them to be and ultimately it comes down to control and independence.

Facts that provide evidence of the degree of control and independence fall into three categories:

1. Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
2. Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
3. Type of relationship: Are there written contracts or employee type benefits (that is, pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?

Reference this IRS article for further guidance: https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee 

If you hire an employee you will need to register with your state and begin running payroll, if you aren’t already.  I recommend Gusto for most clients, but send me an email and we can go over what’s best.

If your hire is a contractor, it's best practice to obtain a W9 from them upfront. You can do this by sending the W9 form (link here) and retaining for your records.

You should pay them in a way that either prepares the 1099 for you (a payroll system) or allows you to not need to file one.

Here are my general recommendations: 

If you run payroll already, then payroll providers will handle the 1099 for you and allow you to send payment to your contractor. They have monthly fees. If you're paying yourself a salary as an S Corp owner anyway or pay employees and this person will be ongoing, this is a good way to pay.

To avoid having to issue a 1099 at all, pay via a third party processor. This may happen if you contractor invoices you through a payment processor like Stripe, PayPal, Dubsado, Honeybook, Wave, QBO, or Xero. In this event you do not need to file a 1099-NEC because the payment processor will issue a 1099-K if requirements and thresholds are met. This is my preferred method though your independent contractor may get confused. See the next question.

If you have a client who paid you for services via cash, check, bank transfer, or a personal app (Zelle, Venmo, PayPal friends & family), then your client is right to ask you for a W9.  If you need help filing that out, just ask.

However most of my clients should not receive 1099s from their clients because they accept payment via a third party processor (Stripe, Paypal goods and services, Wave, Honeybook, Dubsado, etc).

Feel free to copy the message below if you need to explain this to a client:

__

Per our bookkeeper, a 1099-NEC is not required because we paid via a third party payment network that will issue a 1099-K instead. 

Please reference the 1099 instructions on page 3 that reads “1099-K.  Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-MISC. See the separate Instructions for Form 1099-K.”

https://www.irs.gov/pub/irs-pdf/i1099mec.pdf 

__

Sometimes you will still receive push back saying they want to file “just in case.”  I just keep pushing back because you don’t file returns you aren’t required to file.  Since your income received from a third party processor is reported on a 1099-K, if your client also reports it then it is double reported.  If you are still having trouble, please reach out to us. 

For the most part, you are able to deduct expenses you pay from your business for the purpose of generating income that are necessary and ordinary in your line of work.

It gets tricky when the expense can double as a personal expense.

If you have a question about deductions, send us an email and ask. I will likely defer to your tax preparer for the final decision but am happy to chat it through with you.

If you tell us something is a business expense, we will take your word on it.

Our engagement does not have us auditing your books - we are simply recording the information and answers you provide to us.

That means if you tell us something is a business expense but it is not, the onus lies with you.

General guidance:

Clothing is not a business expense if it can be worn personally.

Your Amazon purchases can be written off if you are purchasing office supplies or other business expenses, but your personal Amazon charges should be paid with your personal card.

Apps used for business can be purchased on your business card, but your personal apps should be paid personally.

Meals can be deducted if there was a business purpose, but a family and friends dinner or your morning coffee or afternoon Uber Eats cannot.

If you take the standard mileage deduction (see Business Mileage below) you cannot also write off gas.

Importance of only using business accounts for business transactions

We have no way of knowing if your Amazon, Apple, Target, meals, or travel purchases are truly for business.

Most of the time we have this conversation upfront and ensure you know that if you are paying for any of the above on your business cards, we are going to treat it as a business expense unless otherwise notified.

If these expenses are not for business, and you get audited, it is your responsibility to have receipts to back up your deductions.

If you have taken non-business expenses as business expenses and therefore underreported your taxes, you may be subject to having to pay the tax you should have paid, plus penalties, interest, and the cost of representation under audit. You should consult with your CPA regarding deductions and also understand your responsibility and risk.

There are two ways to deduct auto expenses:

The actual method - allows you to deduct the business use percentage of actual auto expenses including gas, maintenance, insurance, and lease payments or depreciation (a specialized calculation of the cost of your vehicle over time). The business use percentage is found by tracking all miles and dividing business miles by total miles driven.

The standard mileage - allows you to deduct 70 cents (in 2025) per business mile driven. This means that for each 2 miles you drive you can deduct more than $1 worth of income and save money on your taxes. This adds up!

The standard mileage method is less complex and less likely to get audited if you're doing it yourself. If you're working with an accountant, it's a good idea to ask them which one is right for you and exactly what you need to do to take the deduction.

You need to log miles in either scenario

Tracking your miles is simple. You just need to note the date of your trip, where you went, the business purpose of the trip, and the miles driven.

Find a way to track the miles that works best for you.  What works best is the method that you will actually use.  Check out the app store for free apps that you can download for your phone that make it really easy!  

What counts as business miles?

Simple! Anything that you're doing for business! 

Examples are:

• business meetings
• networking events
• shopping for office supplies
• trips to the post office
• traveling between clients or to different clients

What doesn't count as business miles?

Commuting does not count as business miles. Commuting is going from your home to your regular place of work. So if you rent an office or work for one client and make the same trip daily, unfortunately that is not counted as business miles. Traveling between clients or to different clients does count.

Something to be aware of

If you're choosing the standard mileage method, you don't pay for gas, oil changes, auto tag renewals, or car payments from your business. Those are all included as an estimate in the 67 cents per miles that you are allowed to deduct and claiming both can get you in trouble.

What is NOT included in the standard mileage rate that can be included is parking and tolls so be sure to pay for those from your business account when traveling for business.

You should work with your CPA to determine what your estimated taxes should be and when you should file.

You should save 25% or more of your profit for taxes. We recommend setting this aside in a high yield savings account so the money is set aside but also earning interest. You can then use this account to make your tax payments both when quarterly estimates are due and at tax time.

Here are some general tips:

Who needs to file: Sole proprietors who have a profit in their business.  Sole proprietors file their business income on Schedule C of their 1040.  Sole proprietors are either doing business by themselves with no business registered, as a registered sole proprietorship, with a DBA, or as a single-member LLC.

What estimated tax payments are: An estimate of taxes that allows you to avoid penalties and avoid paying in taxes all at the end of the year when they money may have been spent already.

Ways to look for the minimum estimated payment: Check last year's 1040 and search for 1040-ES vouchers. These are the minimum you need to pay, with rare exceptions.

How to calculate your payment: By providing our reports to your CPA and asking for their support determining if you should file estimated taxes, and if so how much. They may also file these for you.

How to file your estimated payment: Either online or by mailing a check and a paper voucher. Your CPA can help with this and should be involved.

How we calculate the 25% of profit that is included in your report: This is calculated on business profit, after the expense for your officer's compensation paid on a W2 is deducted, if there is any. This assumes your withholdings on wages are appropriate, and estimates you owe 25% on the profit after paying yourself wages.

Are you happy with our services and know someone else who would benefit from a good bookkeeper?

Just send them to my quote form at www.alissalynne.com/quote and tell them to put your name in the field asking "How did you hear about working with Alissa?"

If they sign on for monthly bookkeeping services, I will send you a $100 referral fee when their first payment is made. 

We appreciate you and love helping each other!