Accounting and Banking Problems

Discussion in 'Business Operations' started by bldinkel, May 31, 2004.

  1. bldinkel

    bldinkel LawnSite Member
    Posts: 6

    I have a problem and could use some advice. I called up my accountant the awhile back and asked him if he thought that it would be a good idea to open up a business account at the bank.He told me no, he said to just deposit the checks from my lawn company into my personal checking account. Reason being that it will make it easier to report my taxes.

    Well I got off of the phone confused again. Reason being I have read on here that many people feel that it is necessary to have an account only for business and not to combine your business account with your personal account. I'm confused should I have a business account? What is the reason for having a business account? I am trying to make sure that I do everything legal. I don't have a very big operation at the moment is it better to wait until you reach a certain income before having a business account?
     
  2. TREEGODFATHER

    TREEGODFATHER LawnSite Member
    Posts: 203

    I have a business account more for keeping "business" money and "personal" money seperate.

    It makes it alot easier to seperate business from personal expenses, for example.

    Legally? I don't think it makes much difference until you incorporate or LLC.
     
  3. BCSteel

    BCSteel LawnSite Senior Member
    Posts: 876

    I had a problem with spending to much business $$ when I was putting all the cheques into one account. I found that it is much easier to keep everything seperate with the two accounts.
     
  4. CRM Lawncare

    CRM Lawncare LawnSite Member
    Posts: 176

    I unfortunately happen to be a full time accountant and part-time LCO. It doesn't matter if you intermingle business funds and personal funds in an account unless you are an LLC or corp. Then you defintely need seperate accts. I personally have seperate accts for easier record keeping. Makes it easier when tax time rolls around.

    Charlie
    CRM Lawncare
     
  5. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    You don't need one, I would highly suggest it.
     
  6. AutoKing

    AutoKing LawnSite Member
    Posts: 14

    Are you the only one writing checks on this account? If you are married and your wife needs a checking account then by all means open a joint checking account and keep the current account for the business.
     
  7. allstar

    allstar LawnSite Senior Member
    Posts: 282

    I don't understand why in the world your accountant would tell you not to open a business account unless you're paying him hourly to separate out all of your business transactions from the personal ones.
    Having a separate account for your business makes things so much easier and the cost is minimal.When it comes time to do your taxes everything will be nice and organized.Less work for the accountant will mean lower accounting fees because most accountants charge by the hour.Good luck.
     
  8. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Posts: 7,547

    What about business use of home things, or if your at wal-mart, and you see a plastic container you could use to store something in and buy it with your personal stuff? I dont think a seperate account would save anything as far as time for these reasons, so i just have a business act.
     
  9. PaulJ

    PaulJ LawnSite Bronze Member
    Posts: 1,776

    First I would get a different accountant. Then open a separate account. third document everything. Figure out what different categories your business expenses fall into and everytime you write a check or pay for something with cash write down what category it will be in. at the end of the year total up the categories and it will make tax time a lot easier. I use basic quicken to do this. It will print out a report with totals for the different categories. my accountant loves it. he just goes down the list and plugs numbers into the tax forms. Plus I can always tell how much is being spent on different things. write myself a couple checks a month that go into the personal account. and pay the personal bill from there.
    works for me.
     
  10. James Cormier

    James Cormier LawnSite Bronze Member
    from Ma
    Posts: 1,218

     

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