Question to ask to a CPA?

1864 Views 14 Replies 8 Participants Last post by Rodney, Aug 31, 2006

T D Homa

Discussion Starter · Aug 20, 2006

Okay so my uncle's a CPA and I don't wanna look like an idiot when I decide to talk to him about opening my own business what should I ask or prepare. Right now I plan to do about 10 to 20 tees a month. Brand new to the industrial, grand opening expected at earliest in the end of next month. Is this to early to seek legal advice or is it better to put my foot dpwn in the ground so I don't get use to improper business style/strategies, What would you recommend?

Thanks,
Tim Homa

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T-BOT

· #2 · Aug 20, 2006

T D Homa said:
Okay so my uncle's a CPA and I don't wanna look like an idiot Tim Homa

ok, let me....... Whats a CPA.

zagadka

· #3 · Aug 20, 2006

certified public accountant...

i think he can notorize things for you, so that's cool

T-BOT

· #4 · Aug 20, 2006 (Edited)

zagadka said:
certified public accountant...

duh! thanks .... here they call it a CCA, i think.

I can tell you that Accounts are closely related to companies and indvisuals that are looking to invest $$$. They usually recommend to their clients when they are making extra money to invest it somewhere......... a lot of times the accounts may have private investors who may be able to help you grow.

maybe ask him about that $$$$$

cause you may start making more that 10-20 ts / month real soon.

Jasonda

· #5 · Aug 20, 2006

T D Homa said:
Is this to early to seek legal advice or is it better to put my foot dpwn in the ground so I don't get use to improper business style/strategies, What would you recommend?

Since you are getting free (I assume) advice from your Uncle, that is a great resource and you really should take advantage of it. Even if you think it is early, in my opinion it is much better to learn about the legal side of running a business now, rather than make mistakes and have to fix them in the future.

Good luck!

binki

· #6 · Aug 21, 2006

You might try telling him what you posted here. Let him help tell you what he thinks you need.

The only thing I would add would be to let him know you don't want to do something just for taxes but you don't want to ignore taxes either.

TshirtKing

· #7 · Aug 21, 2006

T D HOMA,
notifying your uncle before you make any intial business moves will be the smartest move you can make. CPA'S are the life line to any well organized biz. you are lucky, most cpa's charge 75-125/hr for consulting fees. i'm sure your uncle will give you a big break. cpa's not only help you construct your bizness, but also help you with your TAXES, entity type, financial structure, state/federal tax filings and a plethora of other bizness related material that you need not stress over. Just ask him, UNCLE, WHAT DO I NEED TO IN ORDER TO START AND RUN A SMALL SUCCESSFUL T-SHIRT BIZ? If he's an excellent cpa, he will draw up a plan of action for you.

remember: UNDERSTAND WHAT YOU DO NOT KNOW AND BRING IN THE PEOPLE WHO DO KNOW. I guarantee you success. I meet with my cpa almost every week and it pays off handsomley.

tshirtking

TshirtKing

· #8 · Aug 21, 2006

oh, good luck

binki

· #9 · Aug 21, 2006

TshirtKing said:
... most cpa's charge 75-125/hr for consulting fees...

Mine charges $150, but he is a partner so I guess that counts for something.

T-BOT

· #10 · Aug 21, 2006

binki said:
Mine charges $150, but he is a partner so I guess that counts for something.

wow!, here we use the gov site to do our taxes etc. you set up an account and the gov has an online help center and a 1-800 to answer questions etc.

Biki, what do you think is the average yearly amount peeps like yourself with a 150/hr acc. pays total ? ....for the year.

Curious, just want to compare something.

binki

· #11 · Aug 21, 2006 (Edited)

LucyRoberts said:
wow!, here we use the gov site to do our taxes etc. you set up an account and the gov has an online help center and a 1-800 to answer questions etc.

Biki, what do you think is the average yearly amount peeps like yourself with a 150/hr acc. pays total ? ....for the year.

Curious, just want to compare something.

Isn't Canada something simple like
'Enter your earnings...'
'Send it in'

Oh wait, That is California!

We pay a little over $1000 to get our taxes done. Plus we go in once or twice a year and pay the hourly rate for consulting. Keep in mind we have mulitple States, multiple returns, sales taxes and 2 fiscal years so I think we are getting a bargain. I would say $1500 to $3000 would be average for something as simple as ours.

Now, we do give the accountant a lot of details all spelled out for him. He could ask us for the electronic files and save some time but he really doesn't do the data entry. They use office folks for that. What he does is look it over and make adjustments to make us look good. We are really paying for him to know the tax laws and to apply them correctly and eat any penalties/interest if he screws up. I don't expect him to do t-shirts and he doesn't expect me to do taxes. That said, I make sure I know what is going on and I read up on the tax laws and changes every year. I leave it to him to be the expert and I ask questions when I don't understand something.

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T-BOT

· #12 · Aug 21, 2006

Thanks Binki.

Here too you need to file provincial and federal taxes but the Gov as it set up where you send in 1 only via the software etc...they seperate it.

Another question:

Is it safe to say that if you pay an Accountant $ 3k/year a business should generate $ 300k in sales revenue ? ( 1% acc. expense )

binki

· #13 · Aug 21, 2006

LucyRoberts said:
Thanks Binki.

Here too you need to file provincial and federal taxes but the Gov as it set up where you send in 1 only via the software etc...they seperate it.

Another question:

Is it safe to say that if you pay an Accountant $ 3k/year a business should generate $ 300k in sales revenue ? ( 1% acc. expense )

I don't think there is a relationship between the two that tight. The cost has more to do with how organized you are with your records and how complicated your situation is. CPA's tend to charge by the hour so the more organized you are the less expensive your tax preparation will be.

As far as letting the IRS or FTB calucate my taxes for me, I only have one thing to say about that. HHHHHAAAAAHHHHAAAAAHHHHAAAA....Fat chance!

FredCFO

· #14 · Aug 31, 2006

T D:

I am a CPA. There are no such things as stupid questions. Call your uncle and ask away.

From what you have described (and subsequent posts):

You are only selling 10-20 tshirts a month. Sounds like a home business. The only thing you really need to do is to fill out Schedule C "Profit or Loss From Business (Sole Proprietorship)" on your Form 1040 "Individual Income Tax Return" for 2006. This is where you list your income and expenses for your business. The state income tax form for Connecticut will follow the Federal return.
CPA's can't notarize anything unless they are also a notary public
CPA's can't recommend investment opportunities created by their clients to their other clients. Their objectivity would be called into question.

Good luck with your business.

Rodney

· #15 · Aug 31, 2006

Thanks for the clarification Fred!

:welcome:

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