Archives for April 2018

Creating Customer Statements in QuickBooks

April 26, 2018 by Brenda McGivern, CPA

Invoices not being paid promptly? Customers questioning their payment history? Create statements.

Let’s say you have a regular customer who used to pay on time, but he’s been hit-and-miss lately. How do you get him caught up?

Or, one of your customers thinks she’s paid you more than she owes. How do you straighten out this account?

Both of these situations have a similar solution. QuickBooks’ statements provide an overview of every transaction that has occurred between you and individual customers during a specified period of time. They’re easy to create, easy to understand, and can be effective at resolving payment disputes.

A Simple Process

Here’s how they work. Click Statements on the home page, or open the Customers menu and select Create Statements. A [Read more…] about Creating Customer Statements in QuickBooks

Your receipts are important: save them

April 23, 2018 by Brenda McGivern, CPA

When it comes to taking qualified deductions on your federal tax return, three things must happen:

Recognize that an expense might be deductible on your tax return.
Keep a record of the expense in an organized fashion.
Obtain the proper (and timely) documentation to support your deduction.

This might be obvious to most people, but here are some typical areas where taxpayers often fall short. In the long run, these items could end up costing you plenty during tax filing season, and trigger IRS audits.

Cash donations to charity. To deduct and support your deduction to a qualified charity you must have valid support. Donations of cash are no longer deductible if they are not supported by a canceled check or written acknowledgement from the charity.

Fair market value (FMV): What is it and how to defend it

April 20, 2018 by Brenda McGivern, CPA

So what is fair market value (FMV)? According to the IRS, it’s the price that property would sell for on the open market. This is the price that would be agreed on between a willing buyer and a willing seller. Neither would be required to act, and both would have reasonable knowledge of the relevant facts.

This is the standard the IRS uses to determine if an item sold or donated by you is valued correctly for income tax purposes. It is also a definition that is so broad that it is wide open to interpretation.

Understand when FMV is used

Fair market value is used whenever an item is bought, sold or donated and has tax consequences. The most common examples are: [Read more…] about Fair market value (FMV): What is it and how to defend it

How Do You File an Amended Tax Return?

April 19, 2018 by Brenda McGivern, CPA

Its’ easy to make mistakes when you’re doing your own tax preparation. The IRS has a special procedure for fixing them.

That sense of accomplishment you feel after you’ve filed your income taxes can turn quickly to dread if you realize later that you made a mistake. What do you do now?

The IRS knows that this will happen to some taxpayers every year. The tax code is so complex, and if you prepare your taxes manually, you’ve probably been shuffling a lot of papers around.

So, first: Don’t panic. You can fix this. The IRS offers what’s called an amended return, the Form 1040X, for just this type of situation. [Read more…] about How Do You File an Amended Tax Return?

What Is a Vendor Credit, and How Do You Record One?

April 12, 2018 by Brenda McGivern, CPA

Whether you’re getting a vendor credit for a refund or a return, you can record it in QuickBooks Online.

When you’re dealing with your company’s vendors, you’re probably accustomed to money flowing in one direction: theirs. Maybe you send them purchase orders and they send you invoices. Or they send you bills and you pay them. Or you walk into a store and buy something your business needs.

Sometimes, though, vendors owe you money. Probably the most common scenario is a return of merchandise, products that you’ve sent back to the supplier for any of a variety of reasons. You may be issued a credit of some kind simply because you’ve been a loyal customer, and a vendor wants to reward you. [Read more…] about What Is a Vendor Credit, and How Do You Record One?

Using QuickBooks’ Income Tracker

April 5, 2018 by Brenda McGivern, CPA

QuickBooks provides numerous ways to learn about your company’s health. Income Tracker is one of the most effective.

You can get an enormous amount of useful information from QuickBooks’ reports – especially if you customize them to isolate the precise data you want. Reports included with the software range from the very simple, like Open Invoices, to output that’s exceptionally complex, like Trial Balance and Profit & Loss.

Warning: Standard financial reports like Trial Balance are easy to run in QuickBooks, but very difficult to understand and analyze. You should, though, be aware of what they’re telling you at least once a quarter – even once a month in some cases. We can help with this.

Sometimes, especially first thing in the morning [Read more…] about Using QuickBooks’ Income Tracker