Welcome to the first episode of 2017! When a new year starts, the subject of taxes usually comes up. When you own a speech therapy private practice, you are responsible for making timely income tax and employee withholding payments to Federal and State governments. In this episode, I discuss 1099s, employee withholding, quarterly filings, quarterly payments, account reconciliation, profit-loss statements, and a simple solution that can make make the whole process easier for you.
In this episode:
01:12 – Over 9447 listeners
02:08 – Only one space available for the Perfect Student
03:20 – Tax Time
03:48 – Xpense Tracker
05:22 – The 1099 shuffle
07:04 – Certified Tax Preparer
08:01 – Monthly meetings with a Tax Preparer
08:14 – Quarterly Payments to the IRS and State
08:34 – More about filing withholdings
Don’t forget when you have a Speech Therapy Private practice and you take insurances or access plans or Medicare, when you get payment from those insurance companies, you’re going to get a 1099 in the mail at the end of the year. And it’s your job to make sure that the IRS knows how much money that you have coming in.[Commercial] Well, Hello everyone! You’re listening to the Speech therapy Private practice Startup Podcast; this is episode number 22. My name is Kyle Meades and I’m a speech pathologist since 1993 and these podcasts are designed to help you improve your business and your life one podcast at a time.
Welcome back to the show everyone, Happy New Year. As of today, today is January 8th 2017 we have over 9447 listeners to the show. I really appreciated it because when we first started a little over a year ago we only have two listeners. And you two listeners know who you are. And I appreciate you guys hanging in there and telling your friends and colleagues because we have listeners all over the world now, from the United states, United Kingdom, Australia, Canada, India, Israel, Philippines, South Africa and Turkey. Now when it comes to the United States breakdown. The biggest and highly listened states are California, Texas, Arizona, New York, Florida, Illinois, Pennsylvania, Massachusetts and it goes on and on. I am grateful that you guys are out there and I appreciate the opportunity to help you and give you that valuable information so you can grow, scale and develop your own Speech therapy private practice.
Also I wanted to tell you I do have one space available for the Perfect student and the Perfect student is where you can come in to Tucson, you can fly in at your own expense and learn from me and work side by side with me. I’ll show you everything you need to now about an Outpatient clinic or a Home health agency or both. And that’s where you have direct access to me. We can work weekly via Skype or GotoMeeting and have calls. I can show you all the things you need to know to grow, scale or even start your own Speech therapy private practice. But its got to be a good fit because I get a lot of emails from people who want to start their own Speech therapy private practice but they’re just not ready yet. So when you do contact me please go to privateslp.com/contact there you can reach me and I wanted you to give me as much information as possible about you and where you are in your Speech therapy private practice journey. Are you just starting out? Do you have employees? About how many patients do you see per month? Do you take insurances? Give me all that information so I can help you better.
Now today I wanted to talk about something that’s probably on you guys mind, it’s about Taxes. I look at taxes as a privilege; I like paying my taxes because if I didn’t have taxes to pay, I wouldn’t be doing well. So I wanted to talk to you about how it used to be with filing taxes and kind of how it is now. So I’ll give you a little bit story, when I was just starting out I used to keep all of my expenses on this app called Xpense Tracker, and if you go back to earlier episodes you’ll see I have a whole podcast about that app and how you can set it up. And basically run your Speech therapy private practice clinic on your smartphone as far as your expenses. That’s a really good podcast to listen to. Go back and check that out. But I used to run everything through my Xpense Tracker application, so when I would go to Costco and get paper and pens for the clinic, I would take a picture of that receipt and loaded into the application there, and then at the end of the year I would take all of my expenses and email it to myself and the application would generate a PDF report. And I would give that information to my CPA and with a big manual folder full of receipts and then she would do my taxes. Now what I used to do when I was on the farnes clinic, for example I’ll tell you a little story about that, I used to go in on a Sunday when it was very quiet, there was no one there obviously because were closed. I remember this one particular time I had the hallway door at the very end of the clinic open and I was just letting some fresh air move through there and I had some music playing and I was just coming in my work zone, and here comes a dog running through the hallway and it was a dog that got out and I was able to get the dog and bring the dog to its owner. So that was kind of neat but I still had my taxes to do right, so what I would do is I would gather all my 1099s, because don’t forget when you have a Speech Therapy Private practice and you take insurances or access plans or Medicare, when you get payment from those insurance companies, you’re going to get a 1099 in the mail at the end of the year. And it’s your job to make sure that the IRS knows how much money that you have coming in, so I used to take all these 1099s and add them up and here I am at the end of the counter there at the office and I’ve got my calculator and a big piece of white paper and a pen and I just got all these little notes and I’m going through my expense reports on my application there on my smartphone and then I’ve got all these 1099 and I’ve got two companies, so I’m adding all these 1099s and making sure they add up with my bank receipt and it was just a lot of pain.
I got it done but I think you guys know what I’m talking when you are an SLP we tend to analyze and overanalyze, “Oh man, I wonder if I forgot something I think I did this back in June, maybe I just didn’t write that down are ruthless check what was this check for, I didn’t put something in the memo section to wonder what that was about, and I would just obsess over everything and to the point where you know it took a few hours but I wonder how I forgot this and I want if I didn’t do this and what if I. Oh man I’m going to get audited and oh my gosh”, and it was very stressful. Tax season and can be extremely very stressful.
So I did this for a few years and I would turn all this report to my CPA and get my taxes file, but nowadays what I’ve done recently started a couple years ago I found a certified Tax preparer and she goes through my books every single month, now when I say book she has access to our checking account and our savings accounts and she reconciles everything that’s in every account, every month and we will meet one time a month, so we can strategize for the month and that year and we can talk about deductions and ways to save money and how much tax we’re going to have to pay and so it’s a nice thing to sit down and talk to a tax professional every month and get what’s called a PL report that’s a profit and loss report, it shows you how much money is coming in and it breaks things down by expenses; for example payroll and health insurance and office supplies everything is in that report. So that’s what I do these days is I have those monthly meetings with my Tax preparer and we go through the profit and loss statements and see how much money we’re going to have to write to the IRS every quarter.
And don’t forget when you’re in Speech Therapy Private practice, you going to have to write these quarterly payments to the IRS and to the state where you live, for example, for me its Arizona. So every quarter I have to write a check to the IRS for income. Every quarter I have to write that check so you have to save for that. Also if you have employees you’re going to have to file what’s called withholdings, so not only do you have to pay your employees, we pay our employees twice a month here in the clinic, but now twice a month we also have to pay what’s called withholding, so the money that you take out of the employees check for taxes for Medicare for Social Security, all of that has to be given back to the government. So you can’t just go spend that money you have to save it. If you go back to some of the early episodes you’ll see that I am a big saver and I don’t spend a ton of money. I spend a lot of money on health insurance, for the employees, free healthcare, the free vision and the 401k and match. Yeah I spend money in the right places but I don’t go out and waste money but you’ve got to give that money back to the government.
So I just wanted to give you a little idea of taxes and if you have your own Speech Therapy Private practice and kind of what it was like back a few years ago and what it’s like now because since I have the certified tax preparer, I don’t really have to go to the office now on Sunday and obsess with a piece of white paper and a pen and a calculator and try to remember everything I did, because all those reports are ready to go the taxes are going to be ready to go by the end of January early February and I’m done; I’ve already paid the taxes for 2016, so I’m already paid up, so it’s really a big relief. If you add that level in your own Speech Therapy Private practice, if you can afford to have a CPA or a tax preparer go through and get you what’s called monthly reconciliation report, that’s advisable.
I hope this has been a good Podcast for you guys today about Taxes and as always if you need something or have questions about your own Speech Therapy Private practice, just shoot me an email firstname.lastname@example.org or privateslp.com/contact and as always, thank you for listening.