Category: online accounting

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‘Tis the (Filing) Season – Time for W2s and 1099 Reporting

1099-santa-hatEvery year-end brings with it not just the holiday spirit, but also the underlying dread felt by small business owners – a creepy and back-of-your-neck hair-raising feeling associated with annual business tax reporting and filing. That old saying about “death and taxes” has a lot of validity to it; sometimes they feel like the same thing to a small business owner. And this is the filing season. Ho ho ho.

The reporting requirements for small businesses seem to be growing at a rapid pace, and business owners are struggling to find the information and tools that ease the adjustment to increasingly burdensome reporting and compliance. The IRS has implemented a number of measures to increase tax revenues and enforce compliance, including stricter 1099 reporting requirements. With information provided at both ends of the “transaction” it is easier to identify those discrepancies which trigger audits.   With this type of business intelligence, the IRS has developed a fairly strong weapon to combat non-compliance, so small business owners need to really pay attention (the IRS is).  If the feds are tooling up, then business owners should, too.

Just to add to the seasonal festivities, make sure you upgrade your accounting software in time to benefit from the right rules and forms. If you run a small business and keep most of your information on spreadsheets (still? really?), that’s OK because there are solutions available which draw the information from spreadsheets, eliminating the need to re-enter data. Seriously, though, you should consider using actual bookkeeping or accounting software.

It is also important to remember that payroll tax filing dates for W-2s and 1099 forms were changed for 2016 taxes, and these changes continue for 2017. The filing deadline for 2017 W-2s and 1099 forms (including Form 1099-MISC) is January 31, 2018, which is a month earlier than the pre-2017 filing date. Thankfully, the deadline for providing W-2 forms to employees and 1099-MISC forms to other workers for 2017 has not changed. This deadline is still January 31, 2018. 

Using a cloud-based service to file 1099s online should be something your business considers doing if it isn’t already. Because most services include form and feature updates, users don’t have to go looking for the right documents or worry that they are using an outdated form.  In an online or hosted solution, users benefit from updates without downloads and get stricter security around their data than would likely be present on their own PC.  As it relates to your accounting software, make sure it has the capabilities you need in this area and don’t settle for limited functionality.

Here are some features you’ll want to look for in your e-filing solution this year:

  • The ability to print and/or mail forms to recipients as well as e-filing forms directly with the IRS or SSA
  • Have Form 1096 or W-3 automatically calculated and transmitted electronically with the detail forms
  • Upload volumes of data with Excel templates or import from your accounting software (saves time and reduces input errors)
  • Store data securely and provide full access to filed forms for multiple years
  • Maintain payer and recipient records securely for use year after year.
  • Encrypt data upon submission and keep it encrypted throughout the entire process
  • Supports 1099 Corrections (should allow filing of corrected forms regardless of how the original form was filed)
  • Accountants, Bookkeepers and Tax Preparers should be able to set up multiple payers and file on behalf of many clients from a single account, even filing for all clients at once or via batch submission

Year-end tax filing, especially dealing with 1099s and W2s, is an arduous task for most small businesses and their professional service providers, yet it is one of those things that simply can’t be put off.  Where there is a single income tax return there could be literally hundreds of associated 1099s or W2s to file.  1099 filing in particular has become more of a focus as authorities crack down on contractor versus employer classifications and seek to develop easier identification of audit candidates (something every business owner wants to avoid).

The point of the discussion is that there are cloud-based tools which are highly useful, feature rich, and very affordable… and business owners and their accountants or bookkeepers would be wise to take a look rather than assuming that the general accounting software will do the trick this year and the next.  Remember that tax filing season is an annual event, and being able to rely on a consistently useful solution can make the season a bit merrier (or at least a little less stressful) for all.

jmbunnyfeetMake Sense?

J

Hi! I was looking for the Frangos.

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Business Data Storage in the Cloud – Accountex Report

The term “cloud” has been applied to all sorts of online or Internet-based application models, and there are a great many approaches to developing cloud-based services and solutions. What this translates to is a volume of options and possibilities for information storage, management, and access in the cloud.Understanding where information is stored, how it may be accessed, and how it might be transmitted to others becomes essential knowledge that business owners should have when they engage with any information technology (IT) solution or service. Yet the plethora of “simple, affordable, and instantly gratifying” services currently available on the web all but ensure that businesses will engage with one or more solutions that provide them with little or no information (much less control) over the placement and management of their data.

Source: Business Data Storage in the Cloud – Accountex Report

Read more about Compliance in the Cloud, and making sure your data doesn’t get lost or compromised, even when you use a hosting company…

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Should You Take Your Practice To The Cloud?

I’ve seen a lot of articles lately (and written more than a few myself) directed towards accounting professionals and “taking your practice online” or “taking your practice to the cloud”.  At this point, when a professional asks me the question “should I take my practice to the cloud”, my response generally comes in the form of two return questions.

The first is “what leads you to believe you have a choice?”

The second is “what makes you think you haven’t already?”

There are a few realities about doing business today that can’t be ignored and cloud computing is at the top of the list.  Professionals can recognize these realities and work with them or fight the changing tide and lose out to more relevant providers.

To address the question of choice, let’s consider the fact that many of today’s entrepreneurs and small business owners have been exposed to Internet services and online technologies for quite a long time.  Use of these services has become an ingrained element in daily life.  Not using online technologies seems “old school” to these folks and is often perceived to be due to some deficiency in the ability to understand or use new tools.  If professional service providers aren’t able to leverage online tools to provide the access, collaboration, and higher level of service which business owners demand, they won’t work with those business owners for very long.

In addressing the “what makes you think you aren’t already?” question, let’s consider the fact that almost all of the accounting software offered today has incorporated cloud-service or Internet-based functionality in some manner.  Even the tried and true desktop editions of QuickBooks financial software  have quite a lot of web service functionality designed in to the product.  Where credit card processing was once an offline (or telephonic) process, it’s now an instantaneous service delivered via the net.  Payroll?  Tax tables aren’t just downloaded to the software where you perform the processing and calculations.  Payroll is a service, delivered via Internet connectivity to Intuit’s payroll service bureaus (or ADP, Paychex, etc.).  Even banking is less traveling to the establishment and more Internet access and data exchange.   We don’t think twice about downloading transactions from the bank computers instead of working from the paper bank statement.

Internet/web/cloud service and functionality has become a pervasive element to almost every aspect of software and computerized business support systems, and it’s a pretty good bet that your firm is already using it. So, let’s not spend our time asking a silly question about whether or not it makes sense to “take the practice to the cloud”.  The obvious answer is yes.

Make Sense?

J

 

Original article: Should You Take Your Practice To The Cloud? You’re Still Asking?
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Licensing for Hosted Application Services: Why it costs what it costs

Licensing for Hosted Application Services:

Why it costs what it costs

Application hosting services are experiencing resurgence in popularity these days, due to the prevalence of messaging about the benefits of a “cloud” technology model.  While hosted application services aren’t really cloud (according to cloud technology purists, anyway), they can look and feel and be paid for just like cloud solutions, so the name fits OK.  Hosted applications are desktop or network applications you access via the web, where the software is implemented and managed by a 3rd party application service provider (the host) rather than being installed on your local PC or LAN.  Some software products may be rental-licensed by the ASP, and when combined with the hosting service, the entire subscription service is more like SaaS (software-as-a-service) than the old “purchase and install” approach.

An important supporting program for application hosting service providers is the Microsoft Service Provider License Agreement program. Under a formal agreement with Microsoft or via an SPLA reseller, service providers and independent software vendors are able to license the latest Microsoft software to provide software services and hosted applications to customers. With the SPLA, service providers and ISVs can lawfully license Microsoft products on a monthly basis to host software services and provide application access for their customers. The SPLA supports a variety of hosting scenarios to help providers deliver highly-customized and robust solutions to a wide range of subscribing customers, and it’s the only valid means for obtaining subscription-based provider licensing for these products.

Because the software products being hosted are essentially desktop or LAN-based products, the underlying technology to “deliver” those applications is generally of a similar foundation.  In cases where the provider is offering hosting of Windows-based QuickBooks desktop editions or Microsoft Office applications, for example, the platforms and servers used by the service provider are almost certainly Windows-based.  This operating system, as well as the rights to allow remote user connections to it, is licensed to the provider from Microsoft under the SPLA.  These elements are referred to as “user” licensing elements.

An aspect of Microsoft reporting and licensing which is not well recognized (or frequently complied with) is the difference between user and application licensing.

User licensing, which includes the Windows server access license as well as the remote desktop user license, is a named user access license. This means that the provider need only report and settle for the user license if the user actually accesses the system during the reporting period (usually each month).  Not quite like a concurrent user model, where only the high count of users is reported, the named user model requires that the license for each user be paid if that user logged in at any time and remained logged in for any length of time during the reporting period.

Application licensing applies to the application software license acquired through and governed by the use-rights provided for and granted under the Microsoft SPLA. Rental application licensing is assigned to a specific, named user, and is to be reported fully on a monthly basis regardless of whether or not the user accessed the software. This is in direct contrast to the named user access licensing described above. Providers are required to report and settle on a monthly basis the total number of subscribed application licenses available to users, including Microsoft Office applications, Exchange, SQL and others, regardless of whether or not the user actually logged in and used the products.  The license is assigned to the user and is therefore required to be paid.

Being an application hosting service provider is a complicated business, and there is a lot to consider when developing subscription services for broad customer delivery.  Pricing is one of the complaints customers voice relating to these services, but the reality is that it takes quite a bit in terms of system resources and licensing to provide an acceptable hosted application experience.  This is one of the areas where SaaS and true cloud solutions benefit from a scale economy – where the application is designed for the platform, and one instance of the solution and platform can serve a large number of customers more affordably.

When working with a hosting service provider, it is wise to recognize that the platform and software licensing costs are there to support the type of applications being hosted.  If you have an SQL-based application, you will need the SQL licensing to support it, just like you have to pay for licensing of an Exchange mailbox or a hosted copy of Word.  Enabling only a portion of the total business software requirement may make it difficult to cost justify hosting just one solution.  However, if the business utilizes the host to manage all the desktop applications and data, the cost-efficiency of the approach can increase dramatically.  Regardless of whether the business elects to continue to run software on local PCs, or if it decides to outsource IT to a host and run it there, the company will have to pay the price for software licensing.

Make sense?

J

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Like your Cheese, the QuickBooks ProAdvisor Website has Moved

Intuit is making big changes to the QuickBooks ProAdvisor program and website, clearly reflecting the desire to keep QuickBooks Online edition at the forefront of the solution set.

The QuickBooks ProAdvisor benefits are now delivered within QuickBooks Online Accountant, including desktop licenses, etc.  Earlier this year, Intuit began redirecting to QBOA for those looking for the ProAdvisor program information, and now the entire ProAdvisor site is about to be fully retired.

Those working with QuickBooks desktop editions should pay close attention here, because being a ProAdvisor no longer means simply getting training and software.  The belief is that all ProAdvisors are professionals serving a client base, and that these professionals should use QuickBooks Online Accountant to manage that client base.  Staff accountants, bookkeepers and those who wish to get accredited for their QuickBooks training, whether desktop or online, will be able to manage that activity only from within the QBOA app.

The ProAdvisor website used to be where enrolled advisors could obtain their training, certification, manage their listings for referrals, and get their software.  With the introduction of client and practice management features geared towards helping ProAdvisors manage their entire client bases (QBO and QB desktop clients), it seems that QBOA is now the sole way for professionals to engage with Intuit as ProAdvisors, too.  No longer a standalone site, ProAdvisors must now enroll and access their program benefits – including desktop benefits – as QuickBooks Online Accountants.

read more on Intuit’s website: ProAdvisor Website moving to QBOA – QuickBooks Learn & Support

Make Sense?

J

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QuickBooks Point of Sale and Hosting

QuickBooks Point of Sale in a Hosted Environment

Retail operators and multi-location store owners often face difficulties in attempting to bring cohesion to their accounting, financial, and operational data.  In so many situations, the retail location –  where inventory is sold and money is exchanged – is far-removed from the administrative location where the financial systems and business reporting exist.  It seems that the best case scenario is to create a means for the remote (retail) locations to operate with real-time access to centralized customer, inventory, and financial data from a primary source. Application hosting services can provide this centralization,  and a platform for standardization, of systems.  Further, the application hosting model can deliver security and managed service which ensures that the systems are available and performing as required.

Even though hosted applications and centralization of the systems and processes in a POS environment may appear to be the right answer, there are caveats and considerations that speak to the realities of today’s technologies.  These caveats should be strongly considered prior to undertaking any reformation of systems and processes relating to the retail locations.

The first fundamental reality which must be addressed is connectivity.

While a retail or store location may enjoy Internet or network connectivity, there should be great consideration given to the wisdom of connecting these locations only and exclusively via remote access systems.

Retail is a dynamic business, and the sale is made when the customer is ready and willing to buy.  Any retail location must be able to process this sale in order to meet the immediacy of customer demand.

 

If the systems in use are exclusively accessed remotely, then the connectivity to those systems become of paramount importance in the ability to do business.  At the very minimum, any remotely-served retail location should have redundant connectivity options, with local personnel being familiar with the connection failover process.

A second strong consideration for a hosted or remotely-deployed POS or retail system is local device support.

Devices, such as card readers, scanners, cash drawers, receipt printers, etc. typically require local PC/computer drivers in order to function.  When served by a remote system, this connection between the host and the local devices may not function.  Limited device support for POS hardware can significantly impact the location’s accuracy and efficiency.

QuickBooks POS was designed for use on a single-user PC environment.  The application is not well-suited to a hosted deployment for multiple users, as the software only allows one instance of itself to run on each computer.  This alone eliminates the benefits of a server-based computing model for POS, whether onsite or hosted. The multi-lane option requires all stores to be connected via the same LAN, so remotely connecting multiple locations isn’t really do-able, either.  This is why there is a multi-store option, allowing the various stores to operate independently and send the daily data back to a master location via a store transfer or email process.

In many cases, the suitable answer is to keep the POS systems running on the local computers and network, and run the accounting applications on the host. The host system, whether it be an on-premises server or a location in the cloud, could also run the software which integrates the POS data with accounting.

integratedFor example, with an installation of QuickBooks accounting the point-of-sale “master location” on the host, the core financial data is able to be secured and protected in the virtual environment without risking lost productivity (and lost sales!) due to connectivity failures at the retail locations.  The end-of-day process at each location is to then copy the POS data to the host system where it is integrated with the accounting system. If the POS system is something other than QuickBooks POS, it simply means that there is another piece of software – the specific POS integration tool – required to transfer the POS data into the accounting software.  QuickBooks desktop accounting integrations are available for most popular POS systems including Micros, POSiTouch, Aloha and others. The integration software (often just a QuickBooks plug-in) would be installed on the computer running QuickBooks, enabling the entry of the POS data into the QuickBooks accounting system.

It makes a ton of sense to centrally manage the accounting and financial data for the business, in a secure location away from the retail storefront and frontline workers.  It’s just that the accounting is easier to host and makes more sense to run as a centrally-managed, hosted solution.  POS, on the other hand?  Not so much.

For a small market vendor or the largest of retail stores, point of sale needs to be up and running at all times, driving receipt printers and cash registers/drawers and barcode scanners. Run the POS system on-premises where the action happens, but keep accounting and finance safe and secure somewhere else.

jmbunnyfeetMake Sense?

J