At Long & Long CPAs we find most small business owners are passionate about what they do. However, they might lack the knowledge to succeed financially and lose track of revenue and expenditures. With years of experience assisting start-ups and small businesses with accounting, bookkeeping and tax-preparation we've run across some common mistakes and some steps to avoid them. Most small business do not have a business plan and have not thought about how to price their products and services.
Businesses in their first year of operation often have a loss. They are trying to build a customer base and establish themselves as a legitimate business. This can be expensive and the tax law limits how much of these “one time, first year expenses” a business can deduct. Startup costs include advertising, marketing, training and office expenses incurred before you open your business.