Dan and Ian called up their accountant to get some actionable advice for saving money as well as his take on PPP loans. Mario Lucibello is a CPA, a tax strategist, and the team’s go-to person for financial questions.
Remember, please consult your own accountant or tax advisor to help you with your specific situation. The following is not legal advice.
See the full conversation with Mario above.
Some Favorite Ways to Save Money
Craigslist and eBay could save you thousands of dollars (but may take some more time).
Track Your Expenses
Use a spreadsheet or software like Mint and update it regularly.
The Credit Card Nuke
Cancel your card and order a new one with a new number. This way you’ll stop being charged for all your subscriptions. If you want to renew, you’ll have to manually do it for each service.
Get Your Books in Order
As a business owner, you have to be able to read and interpret the balance sheet and P&Ls.
Have Someone to Talk to
Find a professional to talk to about tax optimization, where to incorporate, and the nuances business finances.
Here’s what Mario is seeing right now with PPP loans:
Many of his clients are filling out the PPP loan. This may not be something they need right now, but there’s no telling what will happen with this crisis and they may need help in the future. The loan is meant to cover two and a half months of payroll. If a business uses the money to keep its employees and continues to pay them, then the loan will be forgiven.
All of the money Congress allocated has been earmarked, but it has yet to be distributed. It’s still unclear when businesses will receive the money. As Mario puts it, “It’s like an ice cream truck offering free ice cream with a million kids trying to get ice cream.”
What are you seeing by looking at businesses every day?
Many companies were making cuts but this is now allowing them to hire people back. Some industries are getting crushed such as travel, but other industries are doing amazing, for example, home entertainment. People are still spending money on businesses, they’re just spending it differently.
What should people be talking to accountants about?
Here are the kinds of questions you should be asking and the discussions to be had with a trusted accountant and tax strategist:
- People (probably) shouldn’t be paying as high taxes as they used and should discuss that.
- Find out if you should be making cuts to your business.
- How to use PPP funds and maximize their use of them. 1% loan is a good loan, but you have to run the numbers to see what makes sense.
- Keeping employees is usually better because finding and hiring is expensive. There are certain scenarios where you should hold on to employees, even if there isn’t much for them to do.
- Help them make sure their bookkeepers and upper management understand the books.
- Potential good investments.
- Questions about big purchases
Continue the Journey
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