02/ 11/ 2008
by Megan Goodchild
Why one small-business owner refuses to tackle her taxes alone
You can't do it all. That's a tough pill for most small-business owners to swallow, and a lesson that Lori Hoyt learned the hard way. After years of doing her business' taxes herself, Hoyt discovered that she hadn't been saving money--she had been losing it.
"We were rolling along thinking everything was good, and then all of a sudden we were like, 'What's this?!' " says Hoyt of Rejuvenate Cosmetic Laser Center in Murfreesboro, Tenn. "We thought we were doing a good job without a CPA, but then we got all of these fines that we weren't even aware were out there."
So Hoyt turned to a CPA for help, and immediately realized the benefits. For the first time ever, Hoyt's business didn't owe the IRS money on tax day.
"The CPA had so many different options for saving money," Hoyt recalls. "We thought doing it one way was the smartest, but it wasn't."
Utilizing the service of a CPA has saved Hoyt countless hours, too. Instead of fretting over the convoluted tax law, Hoyt was able to concentrate on running her business.
"CPAs have so many more resources at their disposal than a small-business owner has," she says. "And they can do it so much more quickly."
Besides preparing yearly taxes, CPAs generally offer a variety of essential services, such as tax planning, purchasing/expensing and forecasting expertise, that few small-business owners possess on their own. And though it can be difficult at first to justify spending the money on professional tax services, small-business owners are actually making an investment in their businesses by doing so, says Mike Slaton, owner of Slaton Financial Services in Dallas.
"Getting a good accountant will usually help you make money," Slaton says.
Small-business owners who do their own taxes have a lot to keep up with, Slaton says, and most can't keep track of all of the changes and reporting requirements in the tax law. As a result, mistakes are inevitable. "The IRS eventually catches up with them," he says.
Hiring a professional gives Hoyt the peace of mind to not worry about tax mistakes anymore--and she has someone to turn to for quick, correct answers.
"A CPA can do it faster--and do it right," she says. "And there's a really good feeling in being able to call them when we need answers."
For the entrepreneurs who might hesitate to bring in outside help, Hoyt advises that in the end, it's really in your best interest to concentrate on your strengths--and leave the taxes to the professionals.
"Don't reinvent the wheel," she says. "Focus on what you do--and do that well."
