Your Questions About Business Online Payroll

Jere answers:

Hi there – I work at Intuit (maker of QuickBooks). We have payroll options for small businesses which can handle payroll, W-2s and 1099s among other things.

We have a 6-month free trial of our Intuit Online Payroll service. It doesn’t require QuickBooks and includes direct deposit for free. For more info you can go to: http://payroll.intuit.com/payroll_services/online_payroll.jsp

An overview of all our payroll options is at: www.payroll.com

I hope this helps!
Chris

Jere answers:

Determine Your Focus
•A construction business can take a variety of forms, from small single-service subcontracting to a developer contracting for large building projects. Construction companies with workers on staff or access to large pools of quality subcontractors can bid on bigger projects.

Construction businesses are required to hold various licenses, such as a retail merchant certificate from your state Department of Revenue, a surety bond and liability insurance. Financing will depend on the scope of the project. Small construction companies often can purchase tools with personal credit and pay helpers once the job is completed. Banks provide qualified builders and developers commercial construction loans as a line of credit that can be drawn upon for supplies and payroll. The balance is typically due when the project is completed. Residential construction loans can provide funding for land acquisition and development and one or two speculative homes. Build relationships with banks by referring home buyers to your bank for mortgages.
Lay the Groundwork
•Most people have spent some time working in the industry prior to starting a construction business. Whether you work as a laborer on a framing crew or spend time helping a developer put together large projects, the on-the-job training will prove invaluable. College degrees and training certificates prepare industry professionals to use the tools of the trade, such as being able to estimate jobs, write contracts and excel at project management. Develop a plan for estimating jobs based on current market rates and the complexity of the job. Online training courses from an organization such as the Construction Estimating Institute can provide valuable information to help you avoid errors in bidding for jobs.
Establish a Business Plan
•Write up a plan that covers the scope of work you will provide, the amount of equipment you will need to purchase, whether you will start in a home office or lease commercial space and the number of staff you need to bid on contracts.

Invest in construction management software programs, such as Projectmates, that can track resources and provide project management guidelines, contract templates and estimating tools. Web-based software programs can work from job sites to put in change orders, manage punch sheets, adjust schedules and provide electronic bidding capabilities.
Network and Market Yourself
•Join a construction association such as the Construction Owners of America Association or Associated Builders and Contractors to build a network within the industry and to take advantage of educational seminars and trade shows. Many industry groups provide member referral programs and access to proposal requests.

Network with other industry organizations that could prove useful to your business, such as Realtors, commercial lenders and government procurement officers. Send press releases to your local business media and trade groups announcing jobs that you’ve landed to keep your name in front of potential clients. Build good relationships with local inspectors, appraisers and insurance adjusters.

Stay in touch with industry news by subscribing to online publications such as Construction Business Owner, which can keep you abreast of changing compliancy regulations, new financing options and technological advancements in construction software.

Jere answers:

While commingling business and personal funds is not a good idea, your records will speak for themselves.

You are aware that as the principal shareholder of an S-Corp you are REQUIRED to pay yourself a salary commensurate with the work that you do for the business and pay payroll taxes on that salary. Right?? Any remaining profits then flow to your personal return via Schedule K-1 to Form 1120-S.

If this all sounds Greek to you, and from the tone of your question I’ll bet that it does, you need an consult with a local expert — a CPA or EA who specializes in small business taxation — to get your bookkeeping up to speed, including your payroll system.

There’s a pretty good chance that they will tell you to dissolve the S-Corp as it is not doing anything for you aside from costing you money in tax prep fees and possibly state minimum franchise fees. What exactly did you expect the S-Corp to do for you in the first place??

Jere answers:

What you are looking for is not computer repair business, but software troubleshooting consultant business. You are not available for house calls, only online connections.
You could be small company competing with Geek Squad, but only offer ‘remote connection’ services. If you check out the site for Geek Squad, their services are offered 3 ways. Walk-in to their store location, remote connection, or in-house calls.

You could also look for permanent employment job rather than consulting business doing remote connection support from home. You should look for job with software companies as high level Technical support staff. With the technical knowledge’s that you described, you would be the higher level support staff, not the one that directly talks to customer. If the solution to the problem is not known and documented, then they call you to look into the problem and figure out what is wrong. Having A+ certification only shows you might have the knowledge to get the job, but if some company knows you could figure out the issues that creep up, you are hired. It is not about what you know, it is about having problem solving ability and figure out any thing that could come up.

They need professionals for troubleshooting runtime environment for their software. Once softwares are bought/sold and installed, there are always some installations that don’t configure correctly. User call support staff and ask for directions/help to make the software work on their computer. You could be the support staff “on call” at home. Once call comes in, they connect it to you and you can handle the call.

Normally you should work for few month in the office to get training and then you could start working from home, they even provide a laptop for their technicians to take home loaded with all the software and tools you need to do the job. (I had friend that used to do this after she had new baby, so she could work from home. She was hired with telephone company.)

Sometimes you might not have calls for days or weeks, but you are still on payroll. Because the company assumes during the time you are not answering any calls, you are at computer learning new stuff, searching web for new ideas, keeping up with industry and new changes.

It is like being a body guard that when he is not needed to follow you around, is at gym working out to stay strong and fit for the job.

Jere answers:

That’s a lot of questions jammed into one! I’ll do my best…

1. Wait until you open a business account for as many expenses as possible. While this isn’t necessary for tax reasons, it’ll be a lot easier for an accountant or bookkeeper later to track your business expenses so you can deduct them for the business later.
As an additional note- do not write yourself checks if you can help it out of this account. I have a client who was just audited for the last 3 years because he did this. The IRS looked at those checks going into his personal account and called it income- again. Transfers are best.

2. As to what you can write off, etc. Etc. It sounds like you’re confused about how taxes work for the business- if you hadn’t incorporated, you’d have a schedule C. Now that the company is an LLC, it has to file a separate tax return. It doesn’t have to pay taxes, but it has to file for informational purposes. So, essentially, the vast majority of your business expenses are written off for the business- not on your personal return. Those expenses then reduce the company’s income, so less “flows through” to you on your K-1. The business can deduct start-up costs (up to $5,000- after that, you must amortize them), bank charges, interest, rent, utilities, telephone, automobile expenses, wages paid to employees, employee benefits, payroll taxes, and on and on and on. The question is more about what the business can’t deduct. If you have specific quesitons, it gets easier.

3. Rent is going to get tricky if, as the case seems to be, your company is based in your home. It’s easiest to forget rent for the company and instead file a form 8829 with your personal return (business use of home). On there, you can claim your rent and homeowners insurance, etc, then you determine what percent of the square-footage of your home is used for the business, and so on- the form explains it fairly clearly.

4. If you hire contractors, you will need to issue 1099s. One of the best things you can do for yourself if you don’t intend to hire a CPA for more than taxes, is to purchase Quickbooks. Do all of your bookkeeping with the program. Your accountant, when you go to see them for help/advice/taxes for the business, can actually take a copy of the company file and use it to help you and to file your taxes. The program can also print 1099s for you very simply. Look up a local CPA firm, find a CPA you like, and talk to them about your needs. At our firm, for instance, we have one of the bookkeepers on staff go out to new businesses or new clients or people having trouble and install Quickbooks and help the client learn to use it. Then we don’t see the client until tax time, when they bring in their file. For other clients, we do all of their bookkeeping for them- including filling out W-2s or 1099s as needed. Most firms are very ammenable to specific needs- if you don’t need a lot of help, then they can just help you out when you have a specific question or have a specific need- like taxes.

Whew! Is it completely obvious that I’m avoiding my own clients’ taxes? Not much of an escape- answering other, non-client tax questions. I need a vacation. :0)

Hope that helps!