Month: November 2025

Preface: “Beware of little expenses; a small leak will sink a great ship.” —Benjamin Franklin

The Importance of a Good Bookkeeper for Your Business

In business, those “small leaks” are usually hiding in the books — and the only way to spot them early is with great bookkeeping. Running a successful business takes more than great products or services — it demands accurate, timely, and insightful financial management. At the heart of that process is one of the most critical yet often overlooked roles: the bookkeeper.

A good bookkeeper does far more than just “keep the books.” They are the financial backbone of your business, maintaining clarity, accuracy, and organization so you can make informed decisions with confidence.

Why Every Business Needs a Good Bookkeeper

Bookkeeping is the foundation of sound financial management. It ensures that every transaction — from invoices to expenses — is properly recorded and categorized. Without accurate records, businesses risk making decisions based on incomplete or incorrect information, leading to missed opportunities or costly compliance issues. A few months of messy books can turn into missed tax deductions, cash-crunch surprises, or expensive cleanup fees at year-end.

A skilled bookkeeper ensures:

• • • Accuracy in financial records: Every entry matches supporting documentation, such as receipts and bank statements.

    • Timely reporting: You always have up-to-date data when you need it — whether for a loan application, tax planning, or strategic decisions.

    • Compliance and peace of mind: Proper documentation is maintained, accounts are reconciled regularly, and federal, state, and local requirements are met.

For example, imagine a small construction company that loses track of vendor payments because invoices aren’t entered promptly. This not only damages relationships but can distort profit margins. A strong bookkeeper prevents such oversights, keeping cash flow steady and vendors paid on time.

Key Skills and Qualities of a Great Bookkeeper

The best bookkeepers bring a mix of technical expertise and soft skills that contribute directly to business success. Indicators of a high-performing bookkeeper include:

• • • Attention to detail: Catches small discrepancies — like a $100 misclassified expense — before they become major issues.

    • Consistency and reliability: Maintains disciplined routines for reconciliations, payroll, and reporting.

    • Technical competence: Proficiency in tools like QuickBooks, Xero, or Sage, plus the ability to automate workflows and generate meaningful reports.

    • Understanding of the business: Knows what drives revenue, cost, and profitability in your industry.

    • Communication skills: Translates financial data into clear insights and explains trends and variances in plain language.

Signs You Have (or Don’t Have) a Good Bookkeeper

A good bookkeeper makes your life easier. Financial reports are timely, your accountant has clean data for tax filings, and you always know your cash position. They proactively alert you to issues like declining margins, late payments, or unnecessary spending.

Inconsistent bookkeeping often shows up as:

• • • Frequent errors or missing documentation

    • Unexplained discrepancies in bank reconciliations

    • Late filings or inaccurate financial statements

    • Difficulty answering basic questions about your accounts

These problems waste time and can lead to major headaches during audits, financing applications, or tax season.

The Strategic Value of Great Bookkeeping

Good bookkeeping isn’t just about compliance — it’s about strategy. Accurate records allow businesses to:

• • • Monitor profitability by project or product line

    • Track key performance indicators (KPIs) like gross margin and cash flow

    • Make smarter growth decisions based on reliable financial data

    • Move faster: With current books, you can act on opportunities or problems in real time — not months later.

For instance, a retail store might discover through clean bookkeeping that one product line delivers 40% of profits but only 10% of sales. That insight can guide marketing and inventory decisions — something sloppy books could easily obscure.

Conclusion

A good bookkeeper is not just a record-keeper — they’re a trusted financial team player in your success. Investing in skilled bookkeeping ensures that your business operates with clarity, confidence, and control.

Whether you’re a startup trying to gain traction or an established company looking to optimize profitability, having the right bookkeeper in place is essential. A great bookkeeper is the unsung hero behind every healthy business — making sure every number tells the true story, on time.

Preface: “Everything worth pursuing comes with a little pain. The trick is not minding that it hurts.” ― Morgan Housel, Same as Ever: A Guide to What Never Changes

Book Summary: Same as Ever: A Guide to What Never Changes by Morgan Housel

Morgan Housel’s Same as Ever argues that although the world around us changes rapidly — technology, markets, societies — the core of human behavior remains surprisingly constant. People still respond in similar ways to fear, greed, risk, and uncertainty, even when the external surroundings look completely different. Housel’s central message is that understanding what doesn’t change in people gives us a more reliable foundation for our decisions than trying to predict every new change.

He illustrates his ideas through a series of engaging stories and examples. One illustrates how risk often comes not from what we expect, but from what we don’t see coming. He defines risk as “what’s left over after you think you’ve thought of everything.” Housel also highlights that happiness and success depend less on the absolute conditions of our lives and more on how our expectations match reality. He suggests that what matters more than our circumstances is how we view them, and that “the first rule of happiness is low expectations.” In our fast‑moving world, the things we think will make us happy can change fluidly, but the internal human drivers—our desire for purpose, recognition, and meaningful connection—remain remarkably stable.

Housel further challenges the idea of constant upward growth. He explains that while we often expect “progress” in an unbroken upward trend, the reality is far more messy: there are setbacks, randomness, invisible improvements (for example what didn’t happen), and cycles of calm and chaos. One chapter is titled “Calm Plants the Seeds of Crazy” which emphasizes that good times tend to provoke over‑confidence, risk taking, and therefore set up the next crisis. Because of this, measuring success purely by visible change can mislead us. Instead, he encourages readers to look for long‑term patterns—how people and systems behave over decades rather than months.

In terms of structure and style, the book is organized into short, engaging chapters (or stories) each focused on a specific theme — such as “Risk is What You Don’t See” or “Expectations and Reality.” Housel uses a mix of historical anecdotes, personal reflections, business/finance examples, and accessible language. This makes the book readable and thought‑provoking rather than dense or purely academic. His approach gives readers a lens for thinking rather than a rigid how‑to guide.

One of the book’s key strengths is its broad applicability. Although Housel draws heavily from his background in economics and investing, many of his lessons apply to life, leadership, relationships, and decision‑making in general. For example, the insight that you can’t predict exactly what will happen, but you can understand how people will behave is a powerful guidance not just for investing but for managing teams, planning strategy, or navigating personal growth.

That said, the book is more diagnostic than prescriptive: it offers lenses for thinking rather than step‑by‑step instructions. Some readers may find it leaves them wanting more concrete “what to do” checklists. Also, because much of its point focuses on universal human behavior, a few ideas may feel familiar or repeat across chapters. But the repetition of these ideas may also reinforce the permanence of these patterns.

In practical terms, Same as Ever invites us to pay attention to our own expectations, to align our behavior with what’s enduring rather than what’s trendy, and to value consistency, curiosity, and patience. It suggests that instead of chasing the latest “next big thing,” we should recognize and lean into the things that remain true across time. For example, when making business or investment decisions, rather than guessing what will change, we ask: “What about this is likely to remain true ten, twenty, thirty years from now?”

Practical some actionable points and reflections drawn from the book:

• • • Adjust expectations: Realize that happiness and success often depend on the gap between expectation and reality. Setting realistic expectations matters.
    • Focus on what you can control: Since you can’t predict many major events, build resilience by controlling what you can—the decisions, behaviors, mindset.
    • Think in terms of permanence: When evaluating something (an investment, a career move, a business strategy), ask: “What about this is likely to remain true 10, 20 years from now?”
    • Recognize the human factor: Because people’s incentives, behaviors and biases are consistent, leadership and strategy should reflect human nature, not idealized models.
    • Embrace long‑term / compound perspective: Whether in money, relationships, career, or personal development—small consistent efforts, patience, cooling the urge for the “next big thing” often win.
    • Story and narrative matter: When communicating decisions (in business or life), consider how the story you’re telling aligns with human behavior—not just the data.
    • Don’t confuse newness for importance: Just because something is novel doesn’t mean it’s more important than the fundamentals.
    • Manage comparisons and mindset: The impulse to compare with others (wealth, status) is enduring—recognizing it helps reduce unnecessary dissatisfaction.

In conclusion, Same as Ever is a compelling exploration of how human nature anchors us amid rapid change. It offers a lens for clearer thinking — helping us focus not just on what is changing, but on what never changes. For students, leaders, or anyone looking to build resilience in uncertain times, this book offers deep and helpful insight. If I were to sum it up in one line: In a world of flux, recognizing the constants gives you the leverage to navigate what changes with greater confidence.

 

Preface: “Therefore shall a man leave his father and his mother, and shall cleave unto his wife: and they shall be one flesh.” – Genesis 2:24

Income Tax for Married People

Your marital status has a profound effect on how the government taxes you. If you have recently gotten married or ended your marriage or have become widowed, it is to your benefit to understand the changes this has on your tax situation.

This post addresses tax considerations specific to people who are married. Being married not only means different tax treatment than being unmarried, it also means it is greatly to your advantage to coordinate your tax planning with your spouse. This is true even if you were married only recently and even if you are filing separate tax returns.

Choosing the Right Filing Status

In the United States, how you are treated for income tax purposes is greatly affected by the filing status you choose on your tax return. As of 2025, there are five possible filing statuses:

• • • Single
    • Married filing jointly
    • Married filing separately
    • Head of household
    • Qualifying surviving spouse

Your choice of filing status determines your standard deduction, your tax rates, and what other deductions and credits you are eligible for. Before you select your status, you should make sure that you meet its requirements.

Married people must in general choose either the “married filing jointly” or “married filing separately” status. Married people who have not finalized all legal proceedings to terminate their marriage by the end of the year cannot choose “single” filing status for that year.

If you were married at any point during the year and have not finalized the ending of your marriage before midnight December 31, you are considered to have been married for tax purposes for that year. Even if your final end of marriage papers go through in the wee hours before sunrise of January 1, you are still married for tax purposes for the year just ended. However, if the end of the marriage is finalized at 11:59PM on December 31, you are considered unmarried for that year.

Death of a spouse is treated very differently than the willful termination of a marriage between living people. If your spouse died at any time in the year, even on January 1, for tax purposes you are still considered married for that year and can file jointly with your spouse who passed away that year. If you remarry before the end of the year, you can file jointly with your new spouse.

You may only file one tax return per year and you must choose only one filing status per year. If you are widowed or have chosen to end your marriage and you then remarry in the same year, you cannot file both with your old spouse and your new spouse.

In some cases, a married person may be able to claim “head of household” filing status. To do this, you must first be able to claim a child you provided for as a dependent. In addition you must either:

• • • Be legally separated from your spouse according to the laws of your state. Pennsylvania residents, please be aware that there is no legal separation status in Pennsylvania. Or,
    • Not have lived with your spouse at any time during the last six months of the year.

Claiming Dependents While Married

You do not have to be married to claim a qualifying child or qualifying relative as a dependent. If you are married, you cannot claim your spouse as a dependent. The tax break you get for being married is being able to choose the “married filing jointly” filing status which has a higher standard deduction and lower tax rates. But your spouse is not your dependent on a joint return. This is true even if you had much more income than your spouse or if your spouse had no income at all.

If you are married and filing jointly, any dependent that you or spouse could claim separately can be claimed on your joint return.

If you file separately and there are dependents you and your spouse could both claim, you must decide which one of you is claiming which dependent. If you both try to claim the same dependent in the same year, the IRS will launch an investigation to see who gets the credit and your refund will be delayed until they have made their determination.

Jointly vs. Separately, Which Is Better?

Most married people are better off filing jointly in most years. Married couples who file separately usually do so for personal rather than financial reasons.

If you file jointly, you must include all income earned by both spouses on the joint return.

If you file separately, you need report only your own income. This means that you and your spouse will not need to share financial information, which some people consider an advantage. However, it is still advisable to coordinate your tax position with your spouse.

Note that if one spouse chooses to itemize deductions, the IRS will not allow either spouse to take the standard deduction. So if you are filing separately, it is advisable to ask if your spouse is itemizing.

As already mentioned, the same dependent cannot be claimed on more than one return. So if you are filing separately and claiming dependents, make sure your spouse is not claiming any of the same dependents you are.

Once you file a joint return, neither spouse can file a separate return for that year.

However, this will not affect your filings for future years. For as long as you are married, you may choose to file jointly or separately for any given year regardless of how you filed previous years.

Most state income tax returns offer a choice between joint and separate filing status similar to that on the federal return. Your choice on your state return need not match the choice you make on your federal return.

There are four major disadvantages to filing separately:

• • • If you are hiring someone to prepare your tax returns for you, you will pay double or close to double in preparation fees since you are paying for two separate filings. Note that the filing threshold for separate filers is $5. Yes, that’s five dollars, which is a much lower threshold than for single filers. This means that if one spouse is filing separately, the other spouse is required to file even with only $5 of income.
    • You will be subject to higher income tax rates. For 2025, joint filers will jump from the 12% to 22% tax bracket at $96,950 of combined taxable income. For separate filers, this cutoff will be at $48,475, the same as for single filers.
    • You will take a lower standard deduction. For 2024, the standard deduction for joint filers is $31,500. For separate filers it is $15,750, the same as for single filers.
    • You and your spouse will automatically be ineligible for a number of deductions and credits including earned income credit, tuition credit, child and dependent care credit, adoption credit, and the student loan interest deduction. It is also likely that more of your social security benefit will be subject to taxation. And a non-working or low-earning spouse may no longer be able to contribute the full amount to an IRA.

Devising scenarios where there is a clear tax advantage to filing separately is something of an academic exercise for accountants. Here are a few possible financial advantages to filing separately:

• • • If both spouses are itemizing deductions and one spouse has low income and high medical expenses and the other spouse has high income and low medical expenses, then the spouse with the low income and high medical expenses will be able to take a bigger medical deduction filing separately. This is because deductible medical expenses are limited to the amount over 7.5% of adjusted gross income reported on the return.
    • For relatively high earners who are just above the phaseout threshold for certain credits and deductions that are not prohibited to separate filers, they may still be able to claim them by filing separately. For instance, the child tax credit begins to phase out at $400,000 for joint filers but only $200,000 for separate filers. Imagine a couple where one spouse earned just over $300,000 and the other earned just over $100,000. If they file jointly, their credit is limited. If they file separately, the lower-earning spouse can still claim the full credit.
    • If both spouses are very high earners, filing separately may allow them a lower rate of income tax. For example, at 2025 rates, spouses with taxable income of $600,000 each will be in the 35% bracket filing separately but in the 37% bracket filing jointly. Earners in the very highest brackets are phased out of most credits and deductions anyway and likely are not taking the standard deduction and in general the disadvantages of filing separately will mean less to them.
    • Consider also that in some cases filing separately may help you qualify for non-tax-related services or products such as financial aid or loans. Any third party that uses your tax return to determine if you are eligible will not be able to see your spouse’s income if you filed separately.

Injured Spouse Allocation of Refund

One consideration that should not be a reason to file separately is a fear that if you file jointly your refund will be taken away to pay your spouse’s debts. You can claim your share of any refund by filing Form 8379: Injured Spouse Allocation. This form is almost like a separate filing in miniature that allows you to compute and claim your share of the refund, but without losing access to any of the credits or deductions that would be disallowed if you actually filed separately. Form 8379 may be included with your joint return or filed up to three years later to request your portion of a refund that has been withheld to pay off debts due to your spouse.

Innocent Spouse Relief

If you filed a joint return and are later subject to additional taxes and penalties because your spouse intentionally misstated income, you may request a waiver from your portion of these additional taxes and penalties by filing Form 8857: Request for Innocent Spouse Relief.

Preface: “There are men who can write poetry, and there are men who can read balance sheets. The men who can read balance sheets cannot write.” – Henry R. Luce

Why CPA-Prepared Financial Statements Matter for Bonding Purposes

For many construction companies, contractors, and service providers working on government or large private projects, obtaining a bond is a critical part of doing business. Whether it’s a bid bond, performance bond, or payment bond, these guarantees reassure project owners that your company has the financial stability and operational capability to complete the job.

One of the most important tools surety companies rely on to assess your business’s financial health is your CPA-prepared financial statements. But what exactly do these statements include, and why do they matter so much for bonding?

Let’s break down what business owners should know.

The Role of CPA-Prepared Financial Statements in Bonding

Surety underwriters rely on financial statements to evaluate your company’s ability to meet project obligations. A CPA-prepared statement offers a professional, independent view of your financial condition—something far more reliable than internally prepared bookkeeping reports.

When applying for a bond, underwriters want to understand:

• • How profitable and stable your business is.
  • Whether you have adequate working capital to complete projects.
  • If your debt levels are manageable.
  • How efficiently your business manages cash flow and operations.

The higher the bond amount, the more detailed and formal the financial statements need to be.

Types of CPA-Prepared Financial Statements

There are three primary levels of CPA-prepared financial statements, each offering a different degree of assurance:

1. 1. Compilation

A compilation is the most basic level. The CPA assembles financial data provided by management into a financial statement format but does not verify its accuracy.
Use Case: Suitable for small bond amounts or internal management use.

1. 2. Review

A review provides limited assurance that the financial statements are free of material misstatements. The CPA performs analytical procedures and inquiries but does not conduct an audit.
Use Case: Often acceptable for moderate bonding needs—typically up to a few million dollars.

1. 3. Audit

An audit provides the highest level of assurance. The CPA performs detailed testing, verification, and examination of records, internal controls, and supporting documentation.
Use Case: Required for larger bonding capacities or when the surety wants the highest level of confidence in your numbers.

Key Components of Financial Statements for Bonding

A well-prepared set of financial statements should include:

• • Balance Sheet – showing assets, liabilities, and equity. Sureties closely analyze working capital (current assets minus current liabilities) and net worth.
  • Income Statement (Profit & Loss) – showing revenues, costs, and profitability trends.
  • Statement of Cash Flows – detailing cash inflows and outflows from operations, financing, and investments.
  • Notes to Financial Statements – explaining accounting policies, contingent liabilities, and other critical information.
  • Work-in-Progress (WIP) Schedule – required for contractors, showing contract revenues, costs incurred, estimated profits, and billings. A well-prepared WIP schedule helps demonstrate how effectively your company manages ongoing jobs—a key metric for surety confidence.

Why CPA-Prepared Statements Matter More Than Bookkeeping Reports

Bookkeeping records can help you run your business day-to-day, but they often lack the accuracy, structure, and third-party verification that bonding companies demand.

CPA-prepared financials:

• • Add credibility – Sureties know the statements were prepared following professional standards.
  • Reflect proper accounting methods – Especially important for contractors using percentage-of-completion or completed-contract methods.
  • Highlight strengths and risks – A CPA can help you present financial information in the best possible light while disclosing risks properly.

In short, high-quality statements can directly affect your bonding capacity and the rates you pay for surety bonds.

How Business Owners Can Prepare

Here are a few practical steps to strengthen your financial position for bonding:

• • Keep accurate records year-round. Don’t wait until year-end to reconcile accounts or gather data.
  • Work with your CPA throughout the year, not just at tax time. Ongoing advisory helps anticipate financial issues that could affect bonding.
  • Manage debt wisely. Sureties look favorably on companies that maintain low leverage and consistent profitability.
  • Build retained earnings. Keeping profits in the business increases equity and bonding capacity.
  • Provide timely updates. Surety underwriters appreciate current financials and open communication about business changes.

The CPA’s Role Beyond Reporting

A knowledgeable CPA doesn’t just prepare statements—they can be a strategic advisor. By analyzing your ratios, margins, and WIP schedules, your CPA can help you:

• • Identify cash flow bottlenecks.
  • Improve project profitability.
  • Plan tax-efficiently while maintaining a strong balance sheet.
  • Communicate effectively with surety underwriters and lenders.

Final Thoughts

For any business that bids on bonded work—especially in construction, manufacturing, or large service contracts—CPA-prepared financial statements are not just a formality; they are a foundation for trust and opportunity.

Investing in a well-prepared review or audit may seem like an added cost, but it’s a smart investment. It can unlock higher bonding limits, lower costs, and open doors to bigger projects—all while giving you a clearer picture of your company’s financial health.

If you’re preparing for an upcoming bonding cycle or want to strengthen your company’s financial presentation, our team can help you choose the right reporting level and position your business for success.

Preface: “You can’t have a million-dollar dream with a minimum wage work ethic.” — Zig Ziglar

No Tax on Tips and Overtime: What the OBBB Act Means for You

During the summer of 2025, President Trump signed the One Big Beautiful Bill (OBBB) Act into law—a sweeping piece of legislation that introduced significant tax changes for both individuals and businesses. Among its many provisions are two that directly impact working Americans: new deductions for tips and overtime pay.

These changes aim to put more money in the hands of employees in industries where tips and overtime are a significant part of their income.

Qualified Tips Deduction

Starting in tax year 2025, individuals who earn tips can deduct a portion of them from their taxable income. The law defines a qualified tip as any cash tip received in an occupation that regularly received tips before December 31, 2024 (for example, restaurant servers, bartenders, hotel staff, and hairstylists).

Here’s how it works:

• • • You can deduct up to $25,000 per year in qualified tips.
    • The deduction starts to phase out if your modified adjusted gross income (AGI) exceeds $150,000 (or $300,000 for joint filers).
    • Once your AGI reaches $400,000 ($550,000 for joint filers), the deduction fully phases out.
    • Married couples must file jointly to claim the deduction, and the taxpayer’s Social Security number must appear on the tax return.

Example:

If you earn $50,000 in wages and $10,000 in tips as a restaurant server, you may be eligible to deduct the $10,000 in qualified tips, reducing your taxable income by that amount. However, this deduction only applies if you meet all IRS reporting and income requirements.

Important: Even though the income tax on these tips can be reduced, you still owe Social Security and Medicare (FICA) taxes on them.

Reporting Requirements for Tips

The IRS requires proper documentation for all qualified tips:

• • • Employers are required to report tips on Form W-2.
    • Employees who receive unreported tips must report them on Form 4137 (Social Security and Medicare Tax on Unreported Tip Income).
    • Independent workers who receive tips should expect to receive Form 1099-NEC or Form 1099-K from their clients or payment processors.

The Treasury Department is updating withholding rules for wages after December 31, 2025, to account for this new deduction.

Qualified Overtime Pay Deduction

The OBBB Act also introduces a deduction for qualified overtime pay from 2025 through 2028. This provision benefits employees who often work more than 40 hours per week.

Key Details:

• • • Individuals can deduct up to $12,500 per year, or $25,000 for joint filers.
    • The deduction begins phasing out when AGI exceeds $150,000 ($300,000 for joint filers) and is completely phased out at $275,000 ($550,000 for joint filers).
    • Married taxpayers filing separately are not eligible.

What Counts as Overtime Pay?

“Qualified overtime compensation” refers to overtime required under the Fair Labor Standards Act (FLSA) — pay at least 1.5 times your regular rate for hours worked beyond 40 per week. This deduction recognizes that many workers rely on overtime income to make ends meet.

Example:

Suppose a factory employee earns $60,000 in regular wages and $10,000 in overtime pay. Under this rule, they could deduct up to $10,000 of that overtime income (subject to income phase-outs), thereby reducing taxable income and potentially saving thousands in taxes.

Reporting Overtime Pay

Just like tips, employers must report overtime pay on Form W-2, while independent contractors should expect to receive a Form 1099-NEC.

For wages earned before January 1, 2026, the IRS allows reasonable estimates when separately identifying overtime income on reporting forms.

A Word of Caution

While these new deductions are generous, they only apply to federal income tax, not to FICA or FUTA (employment) taxes. That means you still pay Social Security and Medicare taxes on your full income, including tips and overtime.

Make sure you keep detailed records — pay stubs, tip logs, and any documentation from your employer — to substantiate your deductions if the IRS requests verification.

Bottom Line

The new tips and overtime deductions in the OBBB Act provide a significant tax break for millions of workers, particularly in service- and labor-intensive industries.

If you regularly earn tips or overtime pay, you could reduce your taxable income by thousands each year through 2028.

However, eligibility depends on income thresholds and proper reporting.