Mitra Bookkeeping

Your LAST estimated tax payment is due on January 15th, here's what you need to know: ⤵️

WHO HAS TO PAY?

If you expect to owe $1,000 or more in taxes when you file your tax return, you generally need to make estimated tax payments.

This generally includes self-employed individuals, business owners, people with significant investment income, and anyone earning income without sufficient withholdings.

WHEN ARE PAYMENTS DUE?

Estimated taxes are paid in quarterly installments. For 2024, the remaining fourth quarter installment is due on January 15, 2025.

Payments can be sent via mail with Form 1040-ES, but I recommend checking out IRS.gov/payments to learn more about the IRS’s electronic payment methods!

HOW MUCH DO I PAY?

You should be paying taxes on the income earned in the period covered by the quarterly tax payment.

To avoid an underpayment penalty, you need to pay at least 90% of the tax you owe in the current year, or 100% (110% for high-income earners) of your prior-year tax liability (whichever is lower).

Wondering when you need to hire a CPA, CFO, or bookkeeper?

Let's break it down! ⤵️

TAX ACCOUNTANT 💰

New business owners should consider hiring a tax accountant BEFORE starting their business if they need help deciding on the most advantageous entity type.

If you don’t need help registering your business, you should look into hiring a tax accountant several months prior to the due date of your first tax filing.

BOOKKEEPER 📚

You should hire a bookkeeper as soon as your business starts generating income if you aren’t 100% confident that you can accurately do your own books. Starting with a clean foundation will save you time and money down the road!

CHIEF FINANCIAL OFFICER 📊

When you need more hands-on financial analysis, it’s time to hire a CFO (or fractional CFO). If your business has grown and you need financial forecasting, budgeting, complex modeling, or other strategic financial planning, it may be time to hire a CFO.

CONTROLLER 🔢

If your day-to-day operations include a significant volume of transactions or are complex enough to warrant a full-time employee(s), it may be time to move your accounting in-house! Consider an experienced controller to lead this team.

Need help finding the right financial pro for you? Let's chat and I'll help you get connected with who you need! 📲

Expectation vs. Reality: The Life of a Law Firm Bookkeeper

Here are some common misconceptions I get about my job as a bookkeeper:

1️⃣ Bookkeeping is just about balancing the books.

✨ REALITY ✨

It’s about ensuring every transaction is compliant with trust accounting rules, managing IOLTA accounts, and keeping attorneys out of ethical hot water.

2️⃣ Once you set up the system, it runs on autopilot.

✨ REALITY ✨

Constant vigilance is required! Every client deposit, every expense—everything must be meticulously tracked to ensure zero errors and compliance.

3️⃣ Month-end closes are a breeze.

✨ REALITY ✨

Month-end is a marathon of triple-checking balances, preparing financial statements, and reconciling trust accounts with nerves of steel.

4️⃣ Clients will always appreciate your hard work in keeping them compliant.

✨ REALITY ✨

Most clients only realize your worth when an audit is looming or a financial discrepancy arises!