New Year's Resolutions For Business Owners (Part Two)
Here are six more New Year’s Resolutions for business owners.
by Cliff Ennico
Do an Annual “Legal Review”. It isn’t enough to hire a good lawyer and pray you don’t get sued. Every business has laws and regulations you need to know about, and it’s your responsibility to learn about them so you can prevent lawsuits before they happen. Take your lawyer to lunch sometime in January, tell him or her everything your business did last year and is planning to do this year, and get some education on how to do things better. If you are a corporation or limited liability company (LLC), have your attorney draft some resolutions for you and your partners “ratifying” the big decisions you made last year – these will save you a lot of heartache if you are ever sued, or audited by a government agency.
Get Your Taxes Right. If you have been selling things online and haven’t been paying taxes, now is the time to get into compliance with the tax laws. The IRS is losing patience with people who don’t know they are in business when they’re selling online, and starting in 2011 (less than one year to go) PayPal and other online payment systems will be required to send you 1099s (with a copy to the IRS) making your activities public. If you’re operating in states other than your own, find out if you owe income or sales taxes in those other states. You probably do.
Renew Your Web Address. If your business is dependent on the Internet, make sure you check Network Solutions (www.networksolutions.com) at least once each year to make sure your Web address hasn’t expired. They do send you renewal notices, but often these get picked up as “spam” by your antispam software, so you never see them, your Web address expires and gets grabbed by someone else. Pick a date that’s easy to remember – like your birthday – and renew each of your important Web addresses on that day.
Update Your Software Twice a Year. Just about every software program gets updated at least once or twice a year, but not every software developer sends you an e-mail announcing the latest updates. Make it a point to visit the Website “home page” of each software company whose products you license, and look for a button that says “check for updates” or something like that. It just may save your PC.
Control the Time You Spend Online. Make 2010 the year you stop being a “social media slave”. Use Web analytics software to find out which of your Internet marketing programs are working and which are not, and where your customers are really coming from. Never mind how much fun something is or that “everyone else is doing it” -- if your Facebook page and Twitter “tweets” are not generating revenue for your business, lose them.
Get Control of Your Bookkeeping. If your bookkeeping system consists of a shoebox, you have absolutely no idea what’s going on in your business. Sign up for your local community college’s evening class on QuickBooks Pro® and learn to do it the right way. If you use “live” bookkeepers, meet with them at least 3 or 4 times every year, review your chart of accounts and other operating statements with them, and get their opinions on things you are doing right and things you need to improve. Because they are not “in the trenches” with you every day, they are likely to see patterns and trends you are too busy to notice.
Start Escrowing for Estimated Taxes. If you pay estimated taxes to the federal and state governments four times a year, and find yourself occasionally without enough cash on hand to make the tax payments, you need to start “escrowing” for these taxes. Tally your gross sales each month, withdraw 40% of that amount from your business checking account, and deposit it in an interest-bearing savings account. Do this every month, and learn to operate your business on the remaining 60% of revenue. This way you will be sure to have enough cash on hand to make your tax payments when they come due.
Run for Public Office. If you are fed up with the political system, it’s time to get involved. A growing number of our state and federal government representatives are “professional politicians” – people whose careers managed to bypass the private sector entirely. Not only do they not “get” business, they look at it as a “necessary evil” – an activity whose primary purpose is to create jobs and tax revenue (not necessarily in that order) that needs to be regulated heavily in order to protect the public. They look upon businesspeople as incompetent if they fail, corrupt if they succeed, and would agree with the 19th century French novelist Honore de Balzac that “behind every great fortune lies a great crime”.
The bottom line: we need more entrepreneurs and self-employed people in government. Make this year the year you decide to run for local, state or federal office. Even if you don’t win, you will send strong messages that government needs to be more responsive to the business community, that successful businesspeople are indeed good citizens, and that free enterprise is essential to a democratic society (to say nothing of the free publicity your campaign will generate). As they said back in the 1960s, “if you’re not part of the solution, you’re part of the problem.”
A happy, prosperous and successful New Year to all of my readers.
Cliff Ennico (crennico@gmail.com) is a syndicated columnist, author and former host of the PBS television series "Money Hunt." This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com.
COPYRIGHT 2010 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS.COM
