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The Hidden Costs of Payroll and Bookkeeping

The Hidden Costs of Payroll and Bookkeeping

The visible costs of Payroll and Bookkeeping can be truly daunting. These two areas have been the bane of many small business owner. The visible costs include not just the cost of the service, but also the cost of not doing it right. All too often, the small business owner gets into tax trouble because of their books. They cannot file a timely return, or files an inaccurate one, and winds up with heavy tax penalties. Or perhaps he has tens of thousands of dollars of perfectly legitimate expenses disallowed because his bookkeeping did not support them.

Payroll can be even worse. The penalties for not forwarding payroll taxes are brutal. Every small businessman has heard these horror stories. The vigor of the IRS in pursuing unpaid Payroll Tax and the penalties exacted make routine IRS collection activities seem tame.

With visible costs like this, it is no wonder that Small Business owner turns to QuickBooks. It seems that you cannot even watch a sporting event on TV, without seeing a QuickBooks ad. How can he be safe and run his business without adequate bookkeeping and payroll? Well he can’t. For many small business owner, QuickBooks seems the answer. Their business is small, and they are or become adept at bookkeeping and payroll using Quikbooks or similar software. They can monitor their income and expenses, file their taxes, and carry on their business.

But what then are the hidden costs?

I will illustrate this by example, one businessman had built a small business grossing about $1.5 million dollars a year. He brought all his QuickBooks and bank and tax data in to our firm to do his taxes, and it was a mess. His tax return could not be filed without extensive bookkeeping, which he paid for. This cost is visible. Where then is the hidden cost?

He had spent 2-3 hours a day all year working on his books. He was the creator and production manager of his business, and had plenty of work to do. But he spent this daily time on his books, and he knew it was important. What did this cost his business? Probably $300,000 in lost income. When he was handling the production and sales of his firm, income flowed in.

What did he get for all this book work? Bad Books.

He even had a secretary who could have been trained up to handle the books.

The hidden cost of bookkeeping and payroll is two-fold:

  1. The income not generated because the owner or key manager is doing books or payroll when he could be running the business to make income.
  2. The profit lost because the bookkeeping is inadequate and the manager does not see exactly what is making money, and what is losing money, and thus cannot take appropriate informed actions to increase profits.

The visible costs can be high enough. Paying the bookkeeper or paying the IRS because of bad bookkeeping or payroll is easily, if painfully, visible. For some, the hidden costs may be small. Maybe you enjoy doing bookkeeping and payroll, and keep your records spiffy and up-to-date in just a few minutes per day (you know, like the guys and gals in the QuickBooks TV Ads). Maybe this does not affect your firm’s income at all.

However, if you make the business run and the income flow in, and are not a great bookkeeper, this hidden cost may be killing you. Your time might be better spent in making more money for the firm, or hanging out with the family.

What to do?

If you have any questions or need any bookkeeping or tax assistance contact Torchlight Tax for a free consultation. We are a tax firm, but we cannot do taxes when when poor bookkeeping obscures the income and expenses of a person or company. So we must be bookkeeping experts as well. No matter how bad your records are something can be done about it. It is far less expensive to pay the bookkeeper to get your books in order than to pay the IRS with bad books.

As the tax deadline approaches, contact us ASAP. We can still file for a tax extension for your C-Corp or sole proprietorship while we get your books in order so we can do your taxes.

One of our Enrolled Agents (top federally credentialed tax expert) will assist you. Email us or call our Toll Free Number (877) 758 7797.

SAVE MONEY BY DOING YOUR TAXES THE RIGHT WAY!

What to do?

What to do?

If you have any questions or need any tax assistance contact Torchlight Tax for a free consultation. One of our Enrolled Agents (top federally credentialed tax expert) will assist you. Email us or call our Toll Free Number (877) 758 7797.

SAVE MONEY BY DOING YOUR TAXES THE RIGHT WAY!

Save The World – Get a Free Video

Save The World – Get a Free Video

If you (or someone you know) would like to be interviewed In a Zoom call and get a free video you can use for your promotion, email me at davehorwedel1@gmail.com. See below for details

SAVE THE WORLD-GET A FREE VIDEO – CO-PROMOTE WITH ME

I want to create a free promotional video interview to promote you, to promote my firm, and to help save the world. You do not have to be a big firm or well-known to qualify for the interview.

The Torchlight Network is doing a series of interviews of opinion leaders in various sectors of society to find out what their successful actions are and how they are coping with the rigors of Covid-19 and the resulting governmental regulations.

SAVING THE WORLD

My major purpose is to broadly promote that successful actions do exist, that SOMETHING CAN BE DONE ABOUT IT, and that individuals can succeed by rising above group think and expand their businesses and activities. By doing this, we can out-create the defeatism, apathy, and hysteria in the current environment.

PROMOTING YOU AS A THOUGHT LEADER

Another purpose is to promote you by providing a video that shows you are being consulted as an expert and leader. You get to expound on how you service your clients and helps others despite Covid-19.

This is effective in showcasing your brand, knowledge, and expertise. Such video content improves engagement and leads to sales.

PROMOTING TORCHLIGHT TAX

A third purpose is to boost the brand and sales of Torchlight Tax. Torchlight Tax is sponsoring the Torchlight Network and its owner, Dave Horwedel, is the interviewer.

As he is interviewing you as an expert/opinion leader, he becomes an opinion leader by association.

PRODUCING THE VIDEO

The interviews usually run 15-20 minutes. They do not take much more of your time than this. As it is an interview format, it is easy to do without script or rehearsal and looks natural and professional and effectively delivers its message.

The video is shot as a zoom call using your computer or phone for picture and audio on your side. Your attire should be appropriate, and you need decent lighting and an appropriate background, or a green screen. (A green screen is a blank green background that allow us put a background behind you.)

The Torchlight Team reviews, edits and transcribes the video so that it is professional and posts it on the Torchlight Network YouTube channel and makes it available to you for promotion.

GETTING THE VIDEO OUT

You post these videos to your social media and sent it to your email list. (If you do not know how to do this, we can help.) The Torchlight Network also sends it out on LinkedIn to our mutual connections.

Plus, your website has a link to the video so that visitors can watch it for years to come. This is how we co-promote our businesses and help the society.

WHAT YOU DO NEXT

Contact us at DaveHorwedel!@gmail.com to take advantage of this.

Once again the purpose on the Torchlight Network is to re-invigorate the economy and society by spreading news of successful applications, help participating businesses with a professional promotional video showcasing them, and help Torchlight Tax to expand by co-promoting with us.

Email davehorwedel1@gmail.com now to let us know you want to take advantage of this.