As a small business owner, you are probably used to DIY-ing most of the duties and responsibilities of your business. Depending on the size of your business, you are likely the CEO, customer service representative, marketing professional, manager, and more.

One of the duties many small business owners handle personally is bookkeeping and accounting. While taking care of your accounting may work at the start of your business, there comes a point when your business finances become complicated enough to require a professional.

If you are a small business owner and are wondering when to hire a small business accountant, here are several signs that you should.

1. You Are Just Starting Your Business

Depending on the structure of your business, you may need an accountant when you are just starting. Hiring a qualified professional from a company like this tax service can help you start on the right foot and take the complexity out of your business taxes.

The right accountant will help you ensure your business structure is a good fit, make appropriate financial decisions, and even help you create your business plan. While this requires more capital upfront, you will save on effort, time, and money in the long-term.

2. You Don’t Understand Your Taxes

When you first start your business, your taxes may be simple enough to DIY. However, the more your business grows, your taxes will become more and more complicated, eventually requiring the help of a small business accounting firm. When your taxes become too complicated for you to understand, it’s a clear sign you need to hire help.

3. You Are Being Audited

If you are being audited by the IRS, it’s a good idea to hire a business accountant. Audits generally occur when it seems likely you have made a mistake on your taxes.

The auditing process can be long, detailed, and incredibly frustrating. You will need to gather all of your documents, and answer to and account for nearly everything you have done financially with your business. Facing an audit is uncomfortable at best but it can be intimidating if you are facing it alone.

Depending on the type of business you own, you may be audited regularly. In these cases, it’s best to hire an accountant to ensure you stay compliant and the auditing process goes smoothly.

4. Your Business Is Growing Quickly

Quick business growth is incredibly exciting for a business owner. It also comes with a specific set of problems.

When your business grows quickly, you can experience outgrowing your offices, overloading your suppliers, not having enough money for supplies, and many more unexpected problems. You can also feel overwhelmed with your new accounting and financial responsibilities.

If your company is growing quickly, hire business accounting services. Your accountant will make sure your business can handle the growth effectively.

5. Your Business Is Having Budgeting Issues

Budgeting problems are common for small businesses. In fact, financial problems are one of the main reasons over half of businesses fail within the first year. For this reason, it’s essential to take care of any financial problems in your business immediately.

Hiring an accountant to review your business finances is ideal for highlighting areas you need to improve. An accountant can help you cut expenses, spend more effectively, and improve your finances overall.

6. You Need Financial Reporting

As your business grows, you will eventually need financial analysis and reporting. This usually occurs when you are considering taking out a loan or bringing investors into your business. The financial reporting will give potential lenders or investors a complete snapshot of your business finances.

Financial analysis and reporting are best left to professionals and that is where an accountant can help. The average business accountant has the knowledge and experience required to effectively analyze your business and package that in-depth analysis into a single report.

7. Your Document Management Is Not Effective

When you are first starting in business, the extent of your financial documents will probably fit into a large file or a small box. However, as time goes on, your financial documents will multiply and you will need to implement a document management system. The system you use must be organized, accessible, and legally compliant.

When you reach this point in your business, consider hiring an accountant. A good accountant can help you set up a document management system and keep your business compliant. This will not only save you time but also save you a lot of headaches.

8. You Are Paying Too Much or Not Enough Taxes

If you are underpaying taxes, or suspect that you are overpaying, it’s time to hire an accountant.

Underpaying results in stressful communication with the IRS that may lead to an even more stressful audit. Overpaying results in lost profit for your small business, which can lead to serious financial problems. Either way, paying the wrong amount for your taxes is bad for you and your business.

9. You Are Expanding to a Different State

Operating your business in your state comes with a specific set of rules to follow. Those rules seem to multiply when you start planning to expand your business to other states. Before starting the process, consider hiring an account.

Your small business accountant will help you navigate the process and ensure you are following all the rules and regulations in the state you are expanding to.

These Are the Signs You Need a Small Business Accountant

These are the signs you need a small business accountant for your company.

If you don’t understand your taxes, are always under or overpaying, or are being audited, consider hiring help. You should also hire a professional if your business is growing quickly, or you are expanding out-of-state. Budgeting problems, document management problems, or the need for professional reporting are all signs your business needs an accountant.

Ultimately, hiring an accountant is a great way to save valuable time and money in your business.

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