Start small and don’t over promise on what you’re able to do. You now know how to start your bookkeeping business—exciting, isn’t it? You’re about to start an adventure, and just like any great adventure, you’ll need more help along the way. Start with one platform and add more as time and budget allow. It takes time to become a great marketer on even a single social media platform, so be patient, and allow yourself to experiment with different types of content. An EIN gives you several benefits and is a necessary component of starting a bookkeeping business.

• For a bookkeeping business just beginning, an insurance policy costs less than your daily cup of coffee.
• 2) An “about” section that communicates who you are as a person and showcases your personality.
• Remember, you’re selling your expertise and adding value to clients who need what you’re offering.
• After you decide on your business structure, you will want to follow the necessary steps to register as soon as you can.
• Non-accounting degree holders who would like to pursue a bookkeeping career can take bookkeeping courses online.
• Jetpack Workflow is a simple piece of bookkeeping software that probably has one of the lowest learning curves.

As your business expands and you add team members, you may need to reevaluate your software needs. Professional liability insurance will protect you against errors, negligence, and omissions that may occur during your bookkeeping engagements. Your premiums will vary depending on what type of services you offer and your projected revenue. You are required to register for a business permit in most locations.

Step 2 – Get training and/or a certification

Registering your business and/or business name is an important step. The cost can range from free to several hundred dollars, depending on your state and the type of business structure you choose. You can use a business formation service to help you decide which structure is appropriate https://bookkeeping-reviews.com/ for you and file all necessary paperwork with the state. If your current clients start referring you to other businesses in the same industry, you might end up in an unexpected niche. Starting up a virtual business doesn’t require ordering a bunch of office supplies.

It’s okay to start with a smaller list of advertised services and add more as you see the need. Bookkeepers who are just starting out often opt for sole proprietorship unless they have additional employees. Once you begin to hire additional staff, consider switching to an LLC or corporation model. For example, you might build an Instagram presence if you want to specialize in helping solopreneurs and online coaches. On the other hand, direct mail is likely a better option if your niche is the automotive industry. This is how clients can send you bank statements, receipts, and more.

Stop RunningYour BusinessLike This!

Like a business bank account, a business credit card allows you to differentiate between personal and professional spending. It also builds business credit and gives you additional financing to help with the initial growth of your business. You aren’t required to have professional training or certifications to start a bookkeeping business. However, these courses can help you build the knowledge and reputation necessary to be successful. You can get certified by a reputable organization, like AIPB or NACPB, or take courses through your local community college.

You’ll also want to open a business credit card account soon. A business card will likely be the first form of financing you’ll qualify for, and it can be a great financial tool to help you with cash flow or necessary expenses early on in your business. It can also be a great way to track your business expenses easily—this will go a long way toward making tax time a breeze. Even if you don’t have formal education in accounting or bookkeeping, you can become a certified bookkeeper before starting your own bookkeeping business. Unlike CPAs, these certifications aren’t regulated by the state, so be sure to choose a large, reputable organization so that the certification is meaningful and respected. You will also create a financial plan that should include a 12-month profit and loss projection, projected cash flow, and a projected balance sheet.

Office phone and internet service

For example, if someone sues you, you could potentially go bankrupt and lose all your assets. While legal should not be ignored (documentation, in particular, is an area that start-ups ignore), registration costs should be kept as low as possible. If you’re entirely new to bookkeeping, there may be some further expenses involved. You might want to carry out training or take a certification to demonstrate your capabilities if you don’t have the experience to back them up. But there’s more to bookkeeping than this – most business owners don’t just want to know the numbers, they want to understand them, too.

• Many bookkeeping firms prepare financial statements that their clients take to CPAs or other tax pros to prepare a return.
• Remember that the amount that you charge should be contingent on your years of experience, specialization in industries, certifications you carry and your area.
• These articles and related content is not a substitute for the guidance of a lawyer (and especially for questions related to GDPR), tax, or compliance professional.
• You will definitely want to check this system out as an option as it’s incredibly popular for bookkeeping businesses and accounting firms.
• When you notice areas in your initially documented processes that aren’t smooth, it’s time to update your process (and documentation) to eliminate points of friction.

Look for licensing that will allow you to keep the books for multiple or unlimited companies and consider any needs specific to your industry niche. The ideal business entity type for your virtual bookkeeping services will depend on your long-term goals and revenue expectations. Each state also has different rules for business taxes, so you’ll need to consider how state taxes would apply to your business. Naturally, getting paying customers is the most important part of starting any business, and this is also true for your own bookkeeping business. Getting your first client means you’ll have someone who can back your claims of offering high-quality and cost-effective services.

Sending prospective customers to voicemail when they need your services can cost you business. Go Answer is a bilingual answering service that connects your customers to live customer service agents via phone, text, web chat, or email 24/7. This step is important because it establishes your business as legitimate and may help to limit your personal liability if your company is ever sued. Whether you’re doing this part-time or full-time, you don’t want to skip this step.

It could be your comments on a recent new tax credit, it could be articles you share that you think group members might be interested in, or any variety of that. Ensure that you provide a brief background of what you did at the company as well. It’s just a matter of finding the events your preferred market hangs out at and heading there with some business cards.

If your virtual bookkeeping firm has employees in several states, you may want to work with an insurance agent to find coverage that works for all your employees. Another tool that will make your life easier is practice management software. This can help you organize and track the progress of client work and, in some cases, provide a portal to access your client’s books. QuickBooks and Xero offer the best accounting practice management software that’s integrated with their accountant software. Once you’ve settled on a business name, you’ll need to register your business in the state in which you will do business.

In addition to tax consequences, your personal liability in the event of a lawsuit can vary dramatically by business structure, so be sure to consult with an attorney. Bookkeeping is a great home-based business that’s easy to start with https://bookkeeping-reviews.com/starting-a-bookkeeping-business/ very little cash. Karbon ain’t cheap, but it’s certainly slick and very popular with certified public accounting firms & bookkeeping teams. When you run a fully virtual bookkeeping business, honestly, there’s not much need for a phone.

How to Start an Accounting Business: Start a Blog

That’s not only important for separating your business and personal finances, but can help you with your own bookkeeping come tax season. The exact process and costs for this vary from state to state and depend on the type of business structure you choose. If you decide to go into business as a sole proprietor, you can simply hang out your shingle and start working. However, registering as a limited liability company (LLC) gives you more liability protection. Depending on the bookkeeping/accounting software you choose, there generally will be a payroll processing option you can turn on when you’re ready to hire employees. If you decide to go with QuickBooks, it offers a variety of payroll options from which to choose.

• You will likely want to establish a business banking account and credit card.
• There are a few ways to go about training – either through an organization or a community college.
• It will protect your financial interests, help minimize disruption to your business, pay your fees if an unhappy client refuses to pay you, and cover the costs of rectifying a mistake.
• It doesn’t have to be fancy – in fact, there are plenty of website builders that make creating a website easy with preset options.

Learn what to consider when completing a bank reconciliation for your client including banking agreements, overdrafts, and effective rate vs marginal rate. Get our latest business advice delivered directly to your inbox. The terms ‘bookkeeper’ and ‘accountant’ are occasionally used interchangeable, but they are in fact two different roles.