Cabin Business

A small-business owner may be tempted to purchase an inexpensive software package to prepare his or her tax return and forgo enduring an annual audit from an outside CPA firm. After all, the small business may have a good product, good cash flow and few employee issues. The owners may not see the need for an annual audit because the business is family-owned, does not need bonding and does not anticipate having to borrow any money in the near future.

Local accountants recently shared how small businesses can save money on business taxes and use good accounting practices.
Michelle Phillips, CPA, said a good place to start is keeping organized records.
“The majority of businesses in Conway are small businesses,” she said. “They may not even know where they are (financially). They may think ‘If I still have money in the bank, I’m OK.’”
Phillips suggested having an accountant do quarterly or year-end planning. Many business owners do not see their CPA until tax time, she said.

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Dr. Pam Spikes, CPA, is a professor of accounting at the University of Central Arkansas. Dr. Patricia Mounce, CPA, is associate professor of accounting at UCA.

Congress still has four months in which to make changes to the 2010 tax law. At this point no one knows exactly what is to come. However, we can only assume that some recent tax changes that will affect 2010 tax returns will remain as enacted.