Your Tax & Business Advisor
Using QuickBooks for Taxes

By Raymond S. Kulzick, CPA, DBA
As published in the Pinecrest Tribune. July 6, 1998. 

 

Can my accountant prepare my taxes from my QuickBooks data?

Many small business owners and professionals are purchasing accounting software such as QuickBooks and Peachtree to use for writing checks and billing customers. These programs have many powerful, user-friendly features.

What makes these programs easy to use, however, is that they operate in a non-accounting way. Unfortunately, this means that the non-accountant user is able to make entries that are incorrect from a tax and accounting standpoint. The program will accept charges to any account classified in any way. This can create tremendous problems at year-end when attempting to use the QuickBooks data to prepare tax returns.

There is a simple process that the small business owner can follow to avoid these problems, assure a smooth implementation, and obtain reliable accounting and tax information. When you purchase the accounting package and are ready to install it, you should consult with your accountant for assistance in properly setting up the program, customizing the chart of accounts for your particular business, and training on how to make various types of entries. The initial setup is critical to the success of the program. An improper setup and months of incorrect entries are very difficult (and costly) to correct later on.

If you don't have an accountant, or your accountant is not familiar with your program, you should find a qualified consultant. Many CPAs have registered as Professional Advisors for Quicken, QuickBooks, and Peachtree.

It is important that the consultant you select is knowledgeable in three key areas: Business, accounting, and computers. Knowledge about how your business and industry works helps the consultant take advantage of various QuickBooks features to provide you with additional useful management information that can save you money. Computer knowledge is needed to be sure the program is working properly and that technology-dependent features (such as internet access) are installed as appropriate. Finally, the consultant must be thoroughly versed in accounting and tax requirements so that your chart of accounts is properly designed to meet your needs and government requirements, as well as to provide accurate and reliable information.

Many of our clients are using QuickBooks and similar programs to great advantage in their business. Having their own accounting online to provide daily management information, as well as year-end tax data, enhances their control over the business. Getting started with the new program has proven to be the most crucial phase of these implementations and securing qualified assistance in the beginning the key to success.

Raymond S. Kulzick is a CPA, and technology and management consultant with offices in Pinecrest at 12177 S. Dixie Highway. If you have questions or suggestions for future columns, please contact him at 305-233-2280 or rkulzick@kulzick.com. More information is also available on the firm's Web site at http://www.kulzick.com/businesspro.

 This article provides information of a general nature only and should not be acted upon without seeking appropriate professional advice concerning your specific situation.

Copyright 1998 Raymond S. Kulzick. All rights reserved. 980706.

 

This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.

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Copyright 1998 Kulzick Associates, PA - Last modified: September 13, 2008