Category Archives: Tax

Mar
31
2023

Outsourcing Tax Preparation – Latest Trend For CPA Firms

Traditionally, small- to medium-size businesses would get accountants and bookkeepers who will work on their accounting concerns. This includes payroll, accounts receivables, sales, and cashiering. Businesses usually set up a division for one particular concern. Most of the time the work is done on a daily basis since it is associated with the business operation as a whole. When it comes to tax preparation, however, some businesses would hire a particular person for this task. However, the person who is assigned to this is very busy only almost once a year. For this reason, some companies find it more practical getting into outsourcing tax preparation.

Outsourcing tax preparation is actually the latest trend in most businesses today. The reason for this is simple: cost efficiency. Instead of hiring additional persons who specialize on tax preparation, businesses simply pay a certain fee to other companies who specialize on this task. There is a big difference when you hire an employee for taxes than simply outsourcing tax return; and most of the time it is the cost that is affected. Here are the reasons why it is more cost efficient if the business considers outsourcing tax returns:

  • When you hire an employee, you are obliged to provide him benefits and incentives. It does not mean that the staff that works on tax prep is not worthy to receive benefits. It simply means that sales and other support groups who focus on generating revenue should be more prioritized. Outsourcing tax only focuses on costs based on the task. The outsourced company is not part of the business, therefore it is not part of any incentives and benefits to keep them working. Besides, outsourcing tax returns works two ways. You get the services of the outsourced company and they promise quality service to you.
  • When you have a staff that works on tax returns, you need to train him for the method or system that you employ in your business. The training would cost considerably. Even though the person is an experienced accountant or CPA, he still needs orientation to the kind of business you have and the system that you practice for tax preparation. When outsourcing tax preparation, you eliminate this concern. This is because you get the service of an outsourcing company who is expected to know the task and knows the different system with regards to tax preparation. Otherwise, such company would not successfully exist if it proposes tax outsourcing but does not actually know all about tax preparation systems at all.
  • Your business covers the variable expenses of the person who is tasked for preparing tax returns. Most often than not, you have to work on little expenses for the work they render. This is true in overtime pays. But outsourcing tax preparation does not give you this concern. You pay for a certain fee one time. Your expenses for the outsourced services are then predictable and consistent. This makes budgeting easier for you at the end.

Overall, you get high percent of savings for outsourcing tax preparation than employing a staff for this task.

Oct
03
2022

Sales Tax – Pros and Cons

Each state has to determine their own ways to obtain income to provide a governing body, services and goods to its people as they operate without any much interference from the Federal government. The sales tax is one such way to meet these kinds of budgets. The consumers, on the other hand don’t see this as much advantage as their incomes are also taxed.

On being questioned as to which tax is favorable to the “low incomes”, the answer surely depends on the place where you reside. In few states prescriptions, ordinary clothing and food are exempted from sales tax by which the “low incomes” can gain advantage of. On contrary to this, there are few states where even unprepared food is taxed. Such states are equitable for exchange as everything is charged with sales tax. Are there any common exemptions to all the states? Well, most of the states are losing billions and millions of money in revenue when compared to neighboring states where there is no sales tax or even if there is any, there are many exemptions to it. The Delaware state attracts people from New York, New Jersey, Pennsylvania and Maryland as they can have a tax-free shopping there. The lack of revenue due to sales tax is compensated by the gross receipts tax obtained from revenue increase. This tax is added to the numerous job retailers who are needed as additional employees for the state.

The ultimate purpose of sales tax-When looking on a large scale people having minimal cash resists buying things that are more than the original face value. It’s a fact that people don’t consider money as top priority to visit their relatives or friends who are residing in tax-free state or a lower tax-state. Needlessly, the state has quite well acquired a picture of sales tax, though money plays the important role for the consumers. The state, like big business magnets, is able to see only the present rather than foreseeing as to how a different approach can bring about a chain of events into a profitable output. Instead of generating an overall tax to necessitate the changes in economy, the state has only a general projection to generate money from various taxes. Sales tax can be substituted by a more profitable plan. This can happen only if the state foresees a big picture in the future otherwise it will remain as mere a castle in the air.