SMB Tax Season: How Managed Services Providers Can Help
SMBs are often founded by a single entrepreneur who seeks to avoid the politics, complexities and headaches of working for someone else, and instead opts for the freedom of being their own boss. Of course, as blues legend BB King famously said, you gotta pay the cost to be the boss, and a large part of that cost relates to processing huge volumes of financial paperwork.
A recent New York Times article reports that SMBs face more paperwork relating to federal and state tax regulations than ever before, with some businesses having to file tax payments as often as five times per month. And especially as state governments find themselves facing significant revenue shortfalls, they are aggressively pursuing SMBs for even the tiniest of infractions.
Managed Financial Services Straighten Out the Books
Hiring a full-time or even part-time bookkeeper is a hugely expensive proposition, and most SMB owners are too busy running the company to have enough time to properly document their taxes. Off-the-shelf financial software typically is not designed to handle the complexity and multitude of data an SMB produces.
However, MSPs can take professional financial software packages, modify them to suit the needs of a specific SMB, and then deliver functionality as a managed service in order to make the whole process cost-effective for a cash-strapped entrepreneur.
Managed Inventory Services Stop Problems before they Start
For any business with a physical inventory (which is all of them except the purest of pure-play dot-com enterprises), properly documenting it and determining important tax-related factors such as depreciation is a huge undertaking which can easily result in costly tax errors. In addition to offering managed financial services, MSPs can also save SMBs from “death by paperwork” through managed inventory services which automatically track inventory as it comes in, goes out, and depreciates in value.
Managed HR Services Ease Growing Pains
HR-related activities like hiring new employees and maintaining employee benefits are tricky enough without having to worry about the possible impact on taxes. Managed HR services can ease the “growing pains” of SMBs who take on new employees by ensuring issues like payroll taxes and insurance payments are properly accounted for.
As we enter the home stretch of tax season, these types of issues are at the forefront of SMBs’ minds, making it a great time to approach SMB clients who may be suffocating under loads of financial paperwork. But SMBs have to deal with financial paperwork all year long, and taxes are one part of business that do not come and go with popular trends or developments in technology.