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personal tax work completed, their monthly payment structure that
includes an advisor service to answer questions and pre plan
expenditures to maximize tax benefits is fantastic".
been missing and how much more I could have been utilizing to get my
taxes decreased. Thank you to Dave and his team for all your insight and expertise! My real estate business is much better financially since I switched
to Real File CPA!"
to our family business as well as everything to do
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Belford E. Voegelin
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1. A Focus on Owner-Managers
Our practice is organized to serve private companies and their Owners. We offer exceptional service that is focused on increasing profitability, preserving wealth from tax and increasing your net worth.
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We’ve been consulting Business Owners for over 32 years. Accountants in Markham are dedicated to your success and treat your business as if it were our own.
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Switching Accountants Is Easier Than You Think
Switching accountants only seems like a major pain in the butt…
But in reality, it’s a brief communication with your current accountant:
“It’s time for a new direction. Please send my books over to Dave & Allen at Real File CPA. Thank you for your service.”
Your accountant is professionally mandated to provide your books to whomever you request they go to. It’s really that easy.
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Business Owner’s Definitive Guide to Growth, Profits, & Tax Minimization By 10 Year+ Accountants in Toronto, Dave Puotinen, CPA.
It doesn’t matter what type of customer you are – whether you are a small business, a giant corporation, or a private party – chances are that at some point, you will come to rely on the services of a Toronto Small Business Accountant. Is now that time? Moreover, how will you know when it’s right to hand your situation over to professional hands?
You’ve come to the right place for the answer to those questions and more. Read on to learn about what you should know before you hire Accountants in Toronto.
It doesn’t matter what type of customer you are – whether you are a small business, a giant corporation, or a private party – chances are that at some point, you will come to rely on the services of an accountant. Is now that time? Moreover, how will you know when it’s right to hand your situation over to professional hands?
You’ve come to the right place for the answer to those questions and more. Read on to learn about what you should know before you hire a Toronto Accounting Firm.
Reasons You Might Need to Hire an Accountant
You know that most people use the services of an accountant, and for a wide variety of reasons, but do your circumstances warrant the help of a professional? And how do you know when it’s time to pick up the phone and reach out for help? Consider these reasons you might hire any Accountants in Toronto:
- You’re not a professional. To put it simply, you don’t have the knowledge, experience, or skill set of an expert. If you want to know for certain that your money matters are in the most competent hands, then your only option may be to recruit a Toronto Small Business Accountant.
- You need some advice. You may not be aware of this, but bookkeeper and accountant do much more than just help you with the practical aspects of completing paperwork and filing financial transactions. They are also responsible for educating their clients on all kinds of money matters, from tax and finance law to investment banking.
- You’re not equipped to catch all of your mistakes. Chances are, you made at least one or two mistakes while filling out your tax forms. No matter how tiny those mistakes may be, they can end up costing you a lot of money down the line. Your best defense against your own mistakes is to hire a professional to do your proofreading.
- You might need someone on your side. No one likes the prospect of a CRA audit. If you do find yourself facing this unfortunate circumstance, wouldn’t you like to know you have a professional backing you up? In the event that the worst does happen, call on a Toronto Accounting Firm. They’re prepared to provide you with the support and representation you need. After all, they do this for a living.
Services Provided by Accountants and Bookkeepers
Now that you’re convinced that you might want to have a reliable accountant in your back pocket at all times, you might want to know what, exactly, you can expect from such a professional. You might be surprised to learn how expansive the offerings are. Here is a list of services provided by accountants and bookkeepers:
- Tax preparation services. From itemizing your expense list to advising you on which forms to file, Toronto Accounting Firms and bookkeepers can help you get your end of the year papers in order and ready to send off to the CRA. Additionally, a qualified accountant can represent you should you be audited by the CRA.
- Business start up advice. There are many tasks that you must successfully complete if you wish you start your own business, and many of those tasks center around your finances. Accountants in Toronto can help you develop a budget, prepare documents needed for business loan submissions, and implement a payroll and invoicing system, and can also offer legal advice pertaining to business start-up.
- Financial report preparation. If at any point in time you need to produce a financial report (profit and loss statement, balance sheet, etc.) for any of a number of purposes (loan application, for example), then a qualified Toronto Small Business Accountant can get the job done.
- Auditing/Review. Generally speaking, an audit is a third-party investigation into your business, taking into consideration all of your financial records, transactions, and account balance. When an accountant audits your business, it is generally because you want to be sure you are operating in compliance with provincial and federal regulations, and that you are handling the financial aspects of your business correctly, so as to avoid serious problems down the line.
- Estate and trust planning. Accountants in Toronto can devise a strategy for how to disperse and allocate your assets in the case of your death. No one likes the idea of planning for their own death, but this is a necessary part of life, especially if you want to protect the well being of any loved ones you might leave behind.
Basic Accounting Terminology
Accountants and bookkeepers seem to speak their own language. Therefore, before you make a first appointment to sit down and chat with a professional number cruncher, you might want to brush up on your lingo. Study up using this list of basic accounting terminology:
- Appreciation. The amount of value your assets gain over a period of time.
- Assets. Everything you own that is worth monetary value. Your assets include tangibles (car, jewelry, etc.) and intangibles (home equity, stock shares, etc.).
- Balance sheet. Detailed record of your financial standing at any one point in time, balancing your assets against your liabilities.
- Depreciation. The amount of value your assets lose over a period of time.
- General ledger. Record of all your financial transactions over a given period of time (accounting period).
- Income statement. Ledger detailing all of your income and expenses (or profit and loss).
- Interest. The amount of money you agree to pay in exchange for borrowing money. Interest may be at a fixed rate, or it may fluctuate in accordance with market conditions.
- Liabilities. Debts that you owe. These include outstanding loans, credit card balances, etc.
How to Find a Reputable Accountant
Now that you know how to talk to an accountant, you need to know where to find professionals who are a good fit for your situation. Fortunately, there are many great resources to help you do just that, and right within arm’s length. Here are some tips for how to find a reputable Toronto Accounting Firm:
- Ask around. If you want to find professionals you can trust, then your best bet is to begin your search by asking people you know you can trust. If your loved ones point you in the direction of a Toronto Small Business Accountant they say is a good catch, then chances are, you’ve found a keeper.
- Use a referral service. You can find such services in the Yellow Pages or online. The great thing about using a referral service is that the service does all of the fact-checking for you, only delivering search results that meet the qualifications (location, credentials, area of expertise, etc.) that you desire.
- Check with the Professional Association of Small Business Accountants (PASBA). This organization is responsible for credentialing qualified professionals, and can provide you with a list of PASBA members in your area. Call the PASBA, or visit their website, to submit inquiries.
- Attend a Chamber of Commerce meeting. Your local Chamber of Commerce is where business owners in your area congregate and share valuable information. You can be sure to get some great referrals, and even to meet some accountants and bookkeepers face to face, when you attend a Chamber of Commerce meeting.
What to Look for in an Accountant
Once you’ve compiled a list of prospective candidates, it’s time to assess each one in order to find your best fit. How do you identify a quality professional when you see one? Consider these factors to look for Accountants in Toronto:
- Experience. Not only should the Toronto Accounting Firm of your choosing have ample experience in the accounting field, but you should also verify that you are working with someone who has a considerable amount of experience working with a clientele that has needs similar to yours. In other words, the accountant who advises a billionaire real estate developer might not be best equipped to handle the practical matters of a part-time employee and full-time caregiver to an elderly parent.
- Credentials. This includes things like education, licensing, and professional organization affiliations. There is no one right solution for everyone. As previously mentioned, the type of professional you need depends on your specific circumstances.
Tips for Making Tax Time Easier
No one enjoys tax season, but that doesn’t mean it has to be as difficult as you fear it might be. There are practical measures you can take throughout the year to ease the tax time burden. Here are some tips for making tax time easier:
- Maintain an organized filing system for your records. Do this throughout the year – i.e. as soon as you have a pertinent tax-related record, file it away. That way you don’t end up with an intimidating pile (mess) of paperwork that must be tackled last minute. Invest in a simple accordion file, or even a file crate, and tuck it away some place where it’s easy to access. Label the files in a way that will help you remember how to get to what you need, when you need it. Not sure what, exactly, you need to save? When in doubt, save everything! Your Toronto Accounting Firm can help you sort out the details when the time is right.
- Keep your receipts. File them away in an organized manner, in your filing system. It’s not enough to claim how much you spend. You must be able to prove it.
- Maintain a separate spreadsheet for your medical expenses. This is an area that can become very complicated if you don’t take the time to record the details. Create a simple spreadsheet (using any basic spreadsheet application like Microsoft Excel, for example) containing headers like Service Type, Service Date/Time, Provider, Cost, Insurance Co-pay, and Payment Method, and input this information every time you visit the doctor’s office. Or simply use Quick Books online, makes our job so much easier.
Take on Ten Commandments of Growing a Business
A recent article adds a modern business spin to our most basic set of rules. On the American Express forum, Barry Moltz writes about The 10 Commandments of Growing a Business. Many of these are concepts we at S+C Partners stress weekly in our posts. There are definitely some lessons to be learned – or stressed again – and we think it’s useful to pass them along. Moltz’s 10 Commandments include:
- Thou shalt watch thy cash flow. The most important financial statement to review monthly is the cash flow statement. Do you have more money at the end of the month than the beginning?
- Thou shalt have a brand strategy. Think through the actual pain your business solves and craft a memorable brand around that message.
- Thou shalt not grow thy company broke. Many entrepreneurs try to grow their companies too fast without the cash, people, systems or infrastructure to do it effectively. In the end, they eventually go broke.
- Thou shalt keep thy current customers happy. Many entrepreneurs are so busy chasing new customers in the front doors, they miss their existing customers exiting out the back.
- Thou shalt keep thy overhead low. Entrepreneurs go out of business because their fixed overheads are too high as their revenues fluctuate.
- Thou shalt guard thy reputation and not speak badly of thy neighbour. In the Internet world reputation is your most valuable asset. Watch and listen to what customers say about you and never directly criticize your competitors.
- Thou shalt get referrals from existing customers. Too many times entrepreneurs do not ask satisfied customers for referrals.
- Thou shalt reward outstanding employees frequently and fire bad employees immediately. Everyone in your organization knows who the good and bad people are. It’s up to you to do something about it.
- Thou shalt review thy financial statements monthly. Find a Small Business Accountant in Toronto who can explain them in terms you can understand.
- Thou shalt take an annual vacation to recharge. This is necessary, not just to recharge yourself but to see how your business does without you.
A great overview, and even some overlap with those original two tablets. As Chartered Accountants working with Canadian small businesses we have found that the small businesses that follow most of these commandments have a much higher likelihood of success. Of course, nothing is guaranteed. But just as living by a few simple guidelines can help us in life, following another set can help in business. By demonstrating the type of vision, focus and discipline inherent in these commandments, you go a long way to increasing your chances of success.
We’re a chartered Toronto Accounting Firm. We’re probably the only people in the universe allowed to use an exclamation mark after the phrase “tax time.” But we do – because this is our time to shine, and to help you get the most from your income whether personal or business tax services are needed.
March is here…you can feel that spring is just around the corner. Warmer temperatures, longer days, fewer layers of down…the nice signs that winter is on its way out.
And tax season…is on its way in. Now is the time to start getting ready to organize and prepare your income taxes. We’re here to help.
By now, you should have already received most of your employer and investment slips. To make sure your returns are prepared as efficiently as possible, you need to organize your information now. This will let us minimize your 2011 income taxes as much as possible.
Here are a few things to start thinking about:
- Personal life. Were there changes in your personal situation in 2011? That could be an address or phone number change…or a new job, new business or investment. The same goes for anyone in your family. Did they get married, start university, have or adopt a child, start a new business or acquire new investments? Did you turn 71 in 2011?
- Slips. Little pieces of paper with big importance. Make sure you have all the necessary information slips from your various sources of income: employment, interest and dividends, pensions, employment insurance, registered retirement savings plans and tax shelters.
- Deductible expenses. If you’re self-employed, own rental properties or are required to incur expenses as part of your employment have you started assembling your deductible expenses and summarizing all your income?
- Other income. If you received income with no information slips, such as tips, business income, partnership income, rental income, taxable alimony or child support, interest or directors fees, you need to summarize it for the year.
- Capital gains/losses. If you sold any assets in 2011 that may give rise to capital gains or losses (ie. stocks and other investments, real estate, businesses) you need to have information available about the original costs, any additional costs you incurred while you owned it, and what you received for the asset when it was sold.
- Other deductibles. There are a whole lot of deductible expenses out there – make sure you keep track of things like: RRSPs, professional or union dues, employment expenses, interest on money borrowed for investment purposes, investment counsel fees, moving expenses, childcare expenses, business investment loss and deductible alimony or support payments.
- Tax credits. Have you made payments that make you eligible for a tax credit? These include rental property taxes, student loan interest, adoption, tuition fees, charitable donations, medical expenses, political contributions, children’s fitness programs, children’s recreation programs, monthly transit passes and more.
- Foreign property. If you own any foreign property that has total original costs greater than $100,000, it needs to be disclosed annually to the CRA.
If you have financial records to manage and you’d like to know that you’re making the most of your money, then you could greatly benefit from hiring a qualified Certified Professional Accountant (CPA). For the utmost in service, competence and reliability, contact the professionals of Real File CPA, Accountants in Toronto.
We serve Home Builders Across the USA as Construction Accountants:
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We Serve Home Builders in Cities Across the USA as Construction Accountants: New York, Los Angeles, Chicago, Houston, Philadelphia, Phoenix, San Diego, San Antonio, Dallas, Detroit, San Jose, Indianapolis, Jacksonville, San Francisco, Columbus, Austin, Memphis, Baltimore, Charlotte, Fort Worth, Boston, Milwaukee, El Paso, Washington, Nashville-Davidson, Seattle, Denver, Las Vegas, Portland, Oklahoma City, Tucson, Albuquerque, Atlanta, Long Beach, Kansas City, Fresno, New Orleans, Cleveland, Sacramento, Mesa, Virginia Beach, Omaha, Colorado Springs, Oakland, Miami, Tulsa, Minneapolis, Honolulu, Arlington, Wichita, St Louis, Raleigh, Santa Ana, Cincinnati, Anaheim, Tampa, Toledo, Pittsburgh, Aurora, Bakersfield, Riverside, Stockton, Corpus Christi, Lexington-Fayette, Buffalo, St Paul, Anchorage, Newark, Plano, Fort Wayne, St Petersburg, Glendale, Lincoln, Norfolk, Jersey City, Greensboro, Chandler, Birmingham, Henderson, Scottsdale, North Hempstead, Madison, Hialeah, Baton Rouge, Chesapeake, Orlando, Lubbock, Garland, Akron, Rochester, Chula Vista, Reno, Laredo, Durham, Modesto, Huntington, Montgomery, Boise, Arlington, San Bernardino
Case Study: How One Home-Builder Saved $1M in Taxes
Last updated Octombar 2019
By Ryan Niadoba, President at N0 Boundaries Advisors
Case Study: How One Home-Builder Saved $1M in Taxes
I first met Jim Lupinetti of One Creation Construction on his job site, while he was in the midst of framing a 2,600 square foot cape cod in an idyllic New Jersey neighborhood across from the park. Guys were running around, lumber was laying everywhere.
Jim had several homes actively being built and dozens more on the horizon. He proceeded to tell us how his business was doubling in size every year. How his team was handling the growth, but how he couldn’t stand that his accountant would never return his phone calls, especially with pending tax returns.
See, Jim’s accountant used to be good. He would call back immediately. Jim always knew when his work was getting done, he understood what the accountant did and why he did it.
Unfortunately, Jim’s accountant became more focused on his own retirement than on helping Jim. Despite being very loyal, Jim had grown frustrated and the time to make a change was now.
What Good Accountants Do…
So we asked Jim.
Our CPA firm’s policy is to return all customer phone calls/emails within 24 hours, with no exceptions. Is that something that would put your mind at ease?
And every single project we do for a customer has a known completion date, in advance, approved by you, the client. Would you like that?
Also, we price all of our services upfront so you know exactly what our bill will be and can make a decision on if you want us to proceed with the work. Does that sound fair?
So are you interested in making the transition to our firm?
At this point, we requested the prior two years of tax returns and access to his books, so that we could evaluate what exactly needed to be done for us to help One Creation Construction.
$1M in Tax-Savings PLUS $1.2M in Profits
Once we dove into Jim’s records, we unearthed a mountain of opportunity! Specifically:
- We felt that we could substantially reduce his tax liability (assuming no growth) by nearly $250k over a decade. If he continued to grow at half of his current rate, we would be able to save in excess of $1M.
- We identified a significant opportunity for risk reduction. Certain corporate structures are considered “high-risk” to be audited by the IRS. By restructuring his company, we were able to reduce his audit risk by 90%.
- As specialists in the home building space, we identified areas for increased profitability that would increase his income by nearly $70,000 in year one and would result in an additional $1.2 million in profits over the course of a decade.
But you’ll be surprised by Jim’s response…
Accountants Miss This All The Time!
As we met with Jim and reviewed these opportunities, we could see he was growing a bit upset.
We took the opportunity to ask him why.
To which he replied: “I just do not understand how my accountant could have missed all of these things for so long. I am so happy I met you guys, but so pissed that I never knew all this!”
We explained to Jim that this is something we see all the time because:
- Most accounting firms are “generalists”. They work with anyone: $125 personal returns, professionals, manufacturers, etc. They are “jacks of all trades and masters of none”. We are 4th generation home builders and exclusively work with home builders or construction companies. We know the building industry better than most. Plus, we never get stretched thin by having to “keep up” with IRS tax law for other industries (professional services, manufacturing, etc).
- Many accounting firms feel their job is to “do your taxes”. It is a lazy business model. They never look for ways for you to improve. One of our core values as a business is to always seek ways for our customers to improve.
- For the accounting firms that do find ways to improve. They often do a poor job of explaining why changes should be made and what the benefits are. As builders ourselves, we know what is important to you and can explain in plain English why to do it.
- Many accountants never propose new ideas because they are afraid that you will not want to pay for these changes. As I mentioned to Jim in the field, all these changes will be priced upfront and it is “ok” for Jim to say “no”. We will never make that decision on his behalf.
In our first year of working together, we were able to save Jim over $100k in taxes. We have restructured his business to reduce the likelihood that he would be audited.
How’d we do it?
Without going into all the eye-glazing details, here’s a high-level overview what we did for Jim:
- Corporate Structure. We reviewed the actual corporate structure that Jim’s business was set up with. There are many different kinds (sole proprietorships, corporations, s corporations, partnerships, UBO, etc) and they all have different tax treatments. Depending on the business, some are better suited than others. We elected to change his structure for significant tax and risk management benefits.
- Tax Minimization. We evaluated what tax laws, deductions, and deferrals could be utilized to minimize his tax bill. The US tax code is the second most complex in the world (#1 is Brazil). We have an extensive review process to identify missed and underutilized tax minimization opportunities.
- Benchmarking Profitability. As certified NAHB trainers we evaluate the profitability of all our customers and compare how they are doing to the rest of the home-building or construction industry. We commonly see new home builders with gross profitability of 10%-15% when they should be closer to 25% to 28%. There are many factors that can lead to this: lack of knowledge, confusing mark-up and margin, not tracking project costs, etc. We were able to determine that Jim (while very profitable) had room for improvement and have been advising him on strategies to increase profits.
We are now focused on helping him grow and look forward to seeing the results happen.
P.S. Is Now The Time For You To Switch Accountants?
You could stick with your current accountant, and potentially give $1Ms more to the IRS and lose even more in profits.
Book a free consultation now because fairly quickly, in plain English, I tell you whether:
- Your current accountant is dropping the ball by leaving $100K to $10M on the table for the IRS, your company structure is a high-risk for an audit, and you’re missing opportunities for profits. Or….
- In the rare cases, we discover your accountant is doing an awesome job with your taxes, company structure, and growth strategy.
If you’d rather not, I understand, I appreciate you reading this far!
About The Author
Do You Know Anyone Who Could Benefit From This Case Study?
Because I’d really appreciate you sharing this case study with your home-builder and construction industry colleagues, family and friends.
Book Your Free Consultation
If you’re looking to grow your business and willing to listen to new and better ideas, then we’re the trusted Accountants in Markham for you.
During our initial consultation, we’ll review your immediate needs and provide a course of action with a fixed-fee quote (no surprise bills here).
Book your free consultation now by calling 1 (647) 499-3939 or book online.