Latest News on Denver Accounting & Taxes

If you are taking advantage of the current open enrollment period for health insurance, you may be considering what’s called a health savings account—or HSA—plan. While selecting a health insurance plan is an important process, just as important is an understanding of the tax-related advantages that come with some of those plans. And an HSA in particular—whether you already have this type of health insurance plan or are looking to sign up for one—can afford you some tax benefits that you may not know about:

• Deduct from your taxes – You can claim tax deductions for contributions you make to your HSA, even if you don’t itemize those deductions on a Form 1040.

• Make contributions – Any contributions—yours or someone else’s—remain in your account until you use them. And contributions from your employer to your HSA may be excluded from your gross income.

• Earn tax-free interest – The interest you earn from the HSA is tax-free. As well, distributions from the account may be tax-free if you use them to pay qualified medical expenses incurred by you or your spouse and/or all dependents claimed on your tax return.

• Keep the account – Your HSA is portable, which means you won’t lose it if you change employers or leave the work force; rather, the account stays with you as long as you choose to keep it open, allowing you to continue to earn tax-free interest (see above).

• Cover out-of-pocket medical expenses – You can spend the money in your HSA—tax-free—on any medical expenses that are not covered by insurance. These include your deductible, copays, prescription drugs, or other bills that may not be covered, such as vision and dental care.

As always, make sure to check the specific details of the HSA plan you are considering or already have, since they may differ from what’s stated above.

It’s important to know that as the rules around health insurance plans and the Affordable Care Act continue to evolve, you may need to talk to a Denver tax specialist to help you navigate these subjects and keep you informed of changing tax benefits and liabilities. Bloch, Rothman & Associates brings over 20 years of accounting and tax preparation experience to Denver, providing services such as tax planning, tax resolution, personal and  business tax preparation, and much more. Contact us today at 303-321-7160 or fill out the form on our website to set up a free initial consultation.

Small businesses owners tend to take on nearly all of the tasks behind running a successful business, from marketing and customer service, to inventory and accounting. However, as your small business grows, it won’t take long before you start to consider getting some outside help. Accountants can provide critical advice and guidance as you grow your business, as well as taking a large amount of time and worry off of your shoulders.
 
Because of the importance of a good accountant, you want to make sure you find the right one for your small business needs. Here are a few things to consider when choosing a Denver accountant.
 
Breadth of services. The first thing you need to establish is the type of services you need help with. Are you looking for someone to simply prepare and file your taxes and compile end-of-year financial statements? Or are you looking for someone who can help with more complex business aspects like financial planning, consulting, or budget analysis? Many small businesses benefit from someone who goes beyond basic tax preparation and acts as a financial advisor to the company.
 
Area of expertise. In addition to ensuring that the accountant you are considering has the proper certifications, it’s a good idea to make sure they are familiar with the industry you are working in. Ask them about their other clients to get a feel for whether they are comfortable with your industry and to determine how experienced they are with the type of services you are looking for. Also consider how many years of experience the accountant or firm has. A firm that has been in business for many years is more likely to be familiar with an array of unique situations or issues that could potentially impact your business.
 
Positive references. As you are searching for firms and accountants to add to your list of potential matches, always be sure to check their references. Take a look at their testimonials to get a better sense of what it’s like to work with them. Do they have a good number of positive testimonials on their site or is it strangely lacking any outside recognition? If other clients are quick to sing their praise, chances are good that you will have a positive experience with them as well.
 
Once you’ve found a potential match, set up an appointment and treat that meeting like an interview. Have your list of services and the level of expertise you feel you need. Be ready to explain where your business is, where you think you need help, and where you’d like to see your business go in the next five to ten years. This is also a great time to ask them how they would represent you in the case of an audit and if they have other references you can contact.
 
If you’re ready to get find the right Denver accountant for you, give Block, Rothman, and Associates a call. We’ll set up an appointment to go over the services we offer and how we can best help your small business succeed.

Tax season can be stressful enough, but if you’re new to freelancing it can feel all the more complicated. Now that you don’t have an employer deducting your taxes for you, you’ll need to keep track of all your income and expenses yourself. But don’t let that overwhelm you. With a little planning and a plenty of recordkeeping, paying taxes doesn’t have to cause you stress. Below are five straightforward Denver tax tips that will help put any freelancer’s mind at ease:
 
Keep Business and Personal Separate
The first step you should take once you start freelancing regularly is to open a separate checking and savings account for your business. Not only will this make your taxes easier, it’s also easier to prove business expenses in the unlikely case of an audit.
 
Set Aside Money for Quarterly Taxes
Now that you’re on your own, you’re going to need to cover 100% of the state and local taxes you owe. This could come with huge sticker shock at the end of the year if you don’t make estimated tax payments quarterly. The paychecks you used to get from your full-time employer had estimated taxes taken out before they got to you. Similarly, your best bet is to deduct 25-30% anytime you receive income from one of your clients and set it aside to pay these quarterly taxes. Out of sight, out of mind.
 
Know What’s Deductible
Deductions are the silver lining to being responsible for 100% of your own state and local taxes. But how do you know what you can deduct? If it’s a required, typical expense associated with running your business, chances are it can be deducted. This includes any equipment you use, your office space, utilities and web hosting fees, office supplies, insurance, travel expenses, and much more. These deductions are filed using the IRS Schedule C form. It’s a smart idea to become familiar with them before you’re ready to file taxes.
 
Write Everything Down
It may seem excessive, but keeping very thorough records will go a long way in not only helping your taxes run smoothly but also making sure you get every deduction you’ve got coming. Coffee with a client? Write it down in your expense log. Driving across town to meet with a client? Write down the miles in your travel log. Just cashed a check from a client? Add it to your income log. And don’t forget to file any and all receipts and bills. No one wants to be frantically searching their office for a missing receipt in order to file taxes.
 
Track Down Those 1099s
Any time you make $600 or more from a single client, you’ll need to report this income. These clients should give you a 1099 form that lists how much they’ve paid you over the last year.
 
A little bit of planning goes a long way when it comes to making tax time headache-free. While it’s easy to feel overwhelmed, we’re here to help. Contact us about our Tax Planning Services. Not only can we can help you prepare before taxes become a hassle, but we can also help you keep more of the money you earned in your business.

With the increasing complexly of the tax code, it’s no wonder that taxpayers are getting confused and making mistakes. From misspellings to wrong numbers, filing mistakes are a common occurrence. Here are the top most common tax mistakes and how to make sure you don’t make them yourself:

1. It may seem like the simplest part of filing your taxes, but people still forget to sign their tax returns. If your return isn’t signed, then it isn’t valid. Also make sure you have two signatures if you’re filing jointly.
2. While many report their social security number correctly, they often enter them wrong for their children or other family members. Always double check these numbers to make sure that you won’t have your return sent back to you.
3. According to the IRS, one of the most common tax mistakes is putting the wrong name on a tax form. This mistake comes up a lot when someone changes their name after marriage and the name on the return doesn’t match the name in the IRS’s system. Make sure that you change your name with the appropriate authorities, such as the Social Security Administration before filing your taxes.
4. What often confuses people is if they should choose to be head of household or single in their filing status. This happens most commonly with divorced parents of children who are minors. It’s hard to know who is legally entitled to claim the kids. Your Denver tax service can help you figure out the correct status to choose.
5. Taxpayers may also mistakenly claim deductions or credits that they aren’t qualified for. However, they also miss out on tax breaks when they do qualify for them. According to the IRS, the most abused/neglected credits are: Earned Income Tax Credit, the Child and Dependent Care Credit, and the standard deduction. Consult with your Denver tax service to find out what you do and don’t qualify for.

Taxes are confusing, time consuming, and easy to make mistakes on. Don’t let your tax return stress you out. Call Bloch, Rothman, and Associates today to make sure you’re getting the most out of your return and that it’s filed accurately. 

Saving money and paying off debt is never fun, but is an important part of improving your financial future. Staying on top of things like paying off your credit card on time and putting a little money aside in savings each month can reduce stress and help you plan for the upcoming months and even next year. Our Denver accountants can offer a few useful tips on how to start getting on top of your finances and budgeting effectively:

Reduce debt: Carrying around debt is stressful – reducing your outflow of money is key to cutting down your debt. If you’re having trouble saving money in certain categories such as entertainment or eating out, make a budget for them. Make a list of 10 things you can cut out of your spending each month without feeling deprived. Getting in control of your spending before the holidays will make sure that you won’t stress out about last minute gifts or unexpected expenses.

Raise your credit score: There are a lot of factors that go into your credit score such as balances on revolving credit that are near limits, tax liens, bankruptcies, recent credit inquiries, and too few or too many accounts. It’s hard to keep track of your score, but luckily, there are financial tools such as Mint.com that can help you stay up-to-date on your score and multiple accounts. It reminds you when your balance is due and can even update you on your progress on saving towards a goal.

Use a financial adviser to keep your investments on track: A financial advisor can help you keep track of your investments as well as provide helpful advice. Keep in mind it’s ok to ask for help when looking to invest – according to Intuit, 62% of working-age women consult a financial adviser when making investment decisions and less than half of men do the same.

You can also get a jump start on reducing your taxes by clearing out your closet and donating unwanted goods to organizations and prepaying tax deductible expenses such as property taxes. Need help with getting in good financial shape by the end of the year? Don’t hesitate to contact your Denver tax specialists, Bloch, Rothman, and Associates for sound financial advice to get you through these next couple months.