Bookkeeping & Accounting in Orlando, FL

Worth Knowing

How Bookkeeping Works for a Florida Small Business

Bookkeeping records each transaction the business makes. Accounting turns those records into reports you can read and a tax return can be built from. The monthly scope is set out in a proposal after the free consultation, based on the services you need.

The reports a set of books produces

A profit and loss statement (P&L) shows income and expenses for a period, such as a month, and the profit or loss left at the end of it. A balance sheet shows what the business owns, what it owes and the owner’s equity on one date. The general ledger is the full record of every transaction, sorted by account. The trial balance lists each account’s balance from that ledger so the debits and credits can be checked against each other. A bank reconciliation matches the books to the bank statement, and a payroll reconciliation does the same for wages and payroll taxes.

Do you need a license to do bookkeeping in Florida?

No. Section 473.322(1)(c) of the Florida Statutes lets people who are not CPAs provide services that use accounting skills, including preparing tax returns and preparing financial statements that carry no opinion. Two things are reserved. Only an actively licensed person may use the title “certified public accountant” or “C.P.A.”, and attest work, meaning an opinion on financial statements, is limited to licensed CPAs and firms. Drew Green is a Certified Public Accountant and is listed in the IRS Directory of Federal Tax Return Preparers with Credentials.

How long the IRS says to keep records

Keep records for 3 years from the date you filed the return in the ordinary case. If you file a claim for a credit or refund, keep them 3 years from filing or 2 years from the date you paid the tax, whichever is later. The period is 7 years for a loss from worthless securities or a bad debt deduction, and 6 years if you leave out income that is more than 25% of the gross income shown on the return. If no return was filed, keep them indefinitely.

Florida sales tax and quarterly estimates

A business whose products or activities are taxable in Florida must register to collect sales tax or pay use tax. The state rate is 6%, and many counties add a discretionary surtax. Sole proprietors, partners and S corporation shareholders generally pay federal estimated tax on Form 1040-ES, due on the 15th day of the 4th, 6th and 9th months of the tax year and on the 15th day of the 1st month after it.