The Taxman Cometh! Accounting and Bookkeeping in Private Practice

It is really designed for small businesses and would be a good app to start with. It not only tracks your income and expenses, but allows you to print invoices and send bills. You can typically deduct expenses necessary to run your therapy practice. Attending a counseling conference, for example, could be a tax write-off. So could subscriptions to psychology journals or a laptop you use solely for work. Try to keep track of everything, no matter how big or small the expense, as you’ll have to account for them when you file taxes.

• QuickBooks is a game-changer for small business financial management, but it’s not always easy to navigate.
• We include the estimated taxes you should set aside and a profit & loss statement detailing your performance for the prior month.
• (No you cannot just go to dinner with your spouse and write it off as a business expense!) Again, check with an accountant on this.
• If you have to do this, create separate accounts for the business, at the very least.

She walked me through the challenging process in a way that is easy to comprehend. As a result of the firm’s collaborative engagement, I’ve been able to build a sound and practical financial plan for my practice. Additionally, there could be other expenses such as health insurance, retirement contributions, home office, mileage, and vehicles, that could potentially be deductible as well. The best thing to do when in doubt is to have a conversation with your tax accountant.

The Practice of Therapy

No PT or OT should have to spend all their time with spreadsheets when they could be caring for more people. Refunds are offered within the first 30 days for courses which have not been completed. After reading this eBook, you will have a great sense of direction on how to take your Private Practice to the next financial level to get more profit. Get guidance on the tools you need so you can enjoy financial freedom.

• We’ll make sure you are compliant while paying the least amount legally possible.
• Afterward, contact your bank to open your practice’s business checking account and apply for a business credit card.
• Outsourcing your bookkeeping could prove to be more cost-effective than you might think, with the financial benefits far outweighing those expenses.
• An accountant takes the information from bookkeeping to help planning ahead for the health of a business.
• Because of her support and attention to detail, my business is on track and will THRIVE.
• The problem with DIYing your accounting is you might not even realize that you’re reporting something incorrectly or missing something important on your taxes.

It eliminates the use of costly and unconnected software applications to make businesses run easier, faster, and safer. With secure document storage, easy client billing, fast payment collections and robust financial reports, healthcare professionals and CPAs can safely run their business on a single platform. Is a complete financial management software with all-in-one features for projects, inventory, sales, and more. As a private practice therapist, at minimum, make sure you’re setting aside money for federal and state taxes, retirement, business expenses, and your salary. I’m a fan of paying yourself 1-2x a month every month, rather than taking money from your business here-and-there when you feel like it. In general, bookkeeping should take about an hour each month.

Private Practice Accounting: Everything Therapists Need for Tax Season

Before making decisions, think about your short-term and long-term goals, and pick a financial system that can easily be implemented today but that can also adjust as your business moves and grows. Andrea Rotondo is the owner of Liquid Cents Bookkeeping. Helping women in business gain simple yet powerful knowledge from their numbers is what she loves to do! Andrea enjoys doing this because she’s also on a journey to build the life and wealth she wants for herself and her family. Everyone on the team is organized and knowledgeable and we feel like we are in very good hands. Whether you do your books on the fly or keep excellent records all year, preparing your statements, receipts, and other paperwork can feel like an all-consuming task.

An “entity” for your business means how your business is structured and what your business is called. A “reasonable salary” is something you need to consider when you file paperwork to become an S-Corp. A clinician might want to “upgrade” from being an LLC or PLLC when their business grows to a point where they can benefit financially. https://kelleysbookkeeping.com/ A “reasonable salary” is state-specific and dependent on a person’s profession. When a business is an S-Corp, they pay themselves a “reasonable salary” and can take owner distributions from their business that are not taxed. Becoming an S-Corp requires some paperwork but may be worth it depending on your business’ earnings.

Our Holistic Approach to Financial Wellness

We help many therapists across the United States with their bookkeeping every month. We offer plans for solo and group practices, billed monthly or annually. I would recommend this service to any fellow clinic owners. As a clinic owner, the finances piece of the puzzle can be so overwhelming. With Therapeutic https://kelleysbookkeeping.com/ Bookkeeping, I understood how my clinic was doing and was able to make better business decisions. The last minute scramble to get your ‘things’ together was real, the mess you handed over to your tax preparer resulted in a much larger bill, and you ended up owing way more taxes than expected.

Using the Profit First system™, we’ll help you reduce expenses and pay yourself more. This post and accompanying podcast are to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult their attorney, business advisor, or tax advisor with respect to matters referenced in this post and podcast. If things got a little out of control and the thought of catching up 3, 6, 12, or 24 months worth of transactions is daunting, we’ll come to the rescue! A few of our team members are affectionately called “the cleaners” and they love to clean up a messy set of books.

The partner you’ve been looking for! Meet the Master Certified Profit First Professional behind Every Single Bean.

I had no game plan for how to grow my revenue or how to even start. Dan explained cash flow within a business without confusing financial terminology. I feel more confident in my skillset as a business owner. I’m much happier too because I’m paying myself significantly more. Hiring Felicia Seton as my CPA has given me a great sense of peace and relief for both my personal and business financial needs. She explained things that are overwhelming and complicated by being very supportive.

They help with all accounting details for both our companies, and they got us a great price on our QuickBooks® software along with a very reasonable fee for all of our regular bookkeeping services. They talk to our accountant each year to make sure he’s aware of major changes that have happened throughout the year, and to make sure our QuickBooks® Online file matches our tax strategy. “Accounting Therapy is professional, knowledgeable, and I enjoy working with them virtually. Alexis quickly cleaned up my bookkeeping and implemented a new invoicing system for me to bill clients directly through QuickBooks®, and created video tutorials for me, which I can reference any time. Alexis gave me the confidence I needed with my business finances.

Make Smart Business Decisions

But this is a somewhat foreign or even controversial topic for this field. Therefore, many therapists avoid looking closely at their numbers because they are “not in it for the money”. I may be biased, but I think that one of the first steps to financial clarity is organized records. Without those numbers, there’s no real data or information to look at for reference. Not only is it a field that I love, but I also think that therapists are great listeners. This is highly important because I’m all for helping my clients connect and “listen” to their money.