Homestead Accounting Group

01/06/2026

Homestead CFO 60: 2025 Q4 Tax quarterly Estimate due January 15!

As the Q4 Estimated Tax Deadline Is Right Around the Corner use this as a way to avoid costly IRS penalties.

What’s the penalty risk?

If you underpay your 2025 estimated taxes by more than 10%, the IRS may assess daily compounding interest on the shortfall.

The penalty generally applies if:
• You owe $1,000 or more at tax time, and
• Your total payments fall short of the required amount

Current IRS underpayment rates are running around 6–7% annually.

Two Ways to Avoid the Penalty

1️ Safe Harbor Method (Simplest Option)
• Pay at least 100% of your 2024 tax liability
(110% if your income exceeds $150,000)
• Payments are split into four equal quarterly installments

2️ Current-Year Method
• Pay at least 90% of your expected 2025 tax liability
• Quarterly payments can be adjusted based on actual income

Take a quick look at your December financials to see whether you meet one of these requirements. If not you might need to make a small Q4 payment now to avoid sending more money to the government later in penalties.

12/08/2025

Homestead CFO 60:S Corp Owners: Turn Your Holiday Gathering into a Tax-Smart Board Meeting!

Do you have family members of your Board? Consider holding your S Corporation's annual board meeting during the holiday season!

Here's why it's brilliant:
Document key business decisions for 2025
Potentially deduct certain travel and meal expenses (when meeting requirements are met)
Create valuable family time while handling necessary business
Set strategic goals for 2026 in a festive atmosphere

This is great way to have your family involved with you business while also getting a business deduction as well.

Remember: Keep detailed minutes, maintain a proper business agenda, and document all decisions. Your gathering can be both meaningful AND strategic!

11/17/2025

Homestead CFO 60:Did You Know Your Breeding Animals Are Tax Assets?

Here is something I just learned a couple of months ago with a new client.

If you’re a farmer, breeder, or business owner investing in livestock for breeding, here’s something most people don’t realize. I didn’t either, until I was doing some research for a new client a couple months ago.

Breeding animals are considered physical business assets that can be depreciated just like equipment.

Why does this matter
1. It can spread your cost of the animal over the useful life or in year 1
2. It sits on the Balance sheet instead of an expense increasing your Assets for loan purposes

Here are some examples
1. Cow kept for Breeding
2. High Value fish or exotic animals used for breeding
3. Any animal purchased with the intent to produce offspring for sale

If you’re not sure how to classify something you recently purchased, feel free to reach out. Making sure you get the right classification can make a real difference in your taxes and financial statements.

11/13/2025

Homestead CFO 60: Don’t Forget the Basics: Simple Tax Moves That Still Save Big

Everyone loves talking about the big tax strategies, but don't forget about some of the foundational moves that provide real savings that are often overlooked.

Here are a few simple moves that can save you real money:

1️⃣ If you’re netting around $40–50K, it’s time to look at an S-Corp. (Reduces Self employment tax)

2️⃣ Choose the right auto deduction: mileage vs. actual.
(This right method could save you a lot depending on how you use your vehicle in the business)

3️⃣ Deduct equipment and supplies used in the business.
(These are ordinary and necessary expenses in your business)

4️⃣ Fund your Roth IRA.
(Great for long-term tax-free growth while staying simple and predictable.)

5️⃣ Pay your family for legitimate work in the business.
(If they help you, compensate them and take a deduction for it)

The fancy strategies are great…
but don’t overlook the basics that consistently help business owners save big every year.

If you want help reviewing your foundation before year-end, I’m happy to walk through it with you.

11/10/2025

Homestead CFO 60: A Lesson I learned the hard way about Self- Employment Tax

If you’re a business owner taxed as an LLC (Schedule C), do you know how much you’ll owe in self-employment tax at year-end?

To be honest, I got burned by this my first year in business. I didn’t set aside enough for taxes and ended up with a surprise bill that taught me a lesson I’ll never forget.

Self-employment tax covers both the employer and employee sides of Social Security and Medicare which accounts for 15.3% of net profit.

Without going too deep into the formulas, here’s a simple strategy I now use and share with clients:

Take 14% of your net income, then divide that number in half.
That gives you a good estimate of what you’ll owe in self-employment tax alone before adding in federal and state income taxes.

Here’s the part that catches many people off guard:
Even if you’re married filing jointly and your business income is below the federal standard deduction (meaning no federal income tax due), you’ll still owe self-employment tax. The IRS doesn’t give you a pass on Social Security and Medicare since those taxes are based strictly on your business profit.

Taking a few minutes to run this calculation now can help you plan ahead, stay stress-free, and avoid that painful “surprise bill” come tax time.

If you’re not sure how much to set aside or want to review your year-to-date numbers, now’s the perfect time to schedule a year-end review.

11/05/2025

Homestead CFO 60: Save thousands in Taxes by cleaning up Inventory

If your business carries inventory, this is the perfect time of year to make sure your physical count or point-of-sale system matches what’s showing in QuickBooks.

Lately, I’ve been seeing a common issue:
Items are being added to inventory, but not properly moved over to Cost of Goods Sold (COGS) when they’re sold.

So why does this matter?
Because inventory sitting on your books has no tax impact — it’s considered an asset until it’s sold.
Once it’s moved to COGS, it becomes an expense that helps reduce your net income (and your tax bill).

In the last month I’ve seen this simple cleanup make a massive difference for 2 business owners:
One client saved over $100,000 in taxes after we corrected their inventory.
Another saved over $6,000 just by reconciling their count and adjusting QuickBooks properly.

Even if you manage your own bookkeeping, this is something you can review yourself. These are real savings just by understanding how inventory flows through your books and affects your taxable income.

If your business has inventory, take time this fall to double-check your numbers.
A clean inventory count doesn’t just make your books accurate — it could save you thousands in taxes.

11/03/2025

Homestead CFO 60:Taxable Income Vs Cash Balance

Why does it feel like you’re broke at year-end but still owe taxes?

Truth is taxable income and cash in the bank are two very different things. You might not feel profitable because your bank balance is low, but the IRS cares about your net income on paper not how much cash is left.

Here’s why that can happen:

You bought new equipment or vehicles (cash went out, Expense is shown on how you depreciate it.)

You paid down loans (Only the interest portion is an expense but you use tax from the profit to pay it down.)

You took owner draws for personal expenses (not deductible).

You built up inventory or prepaid expenses (cash spent now, expense later).

All those things lower your cash, but they don’t reduce taxable profit. Which means a bigger tax bill even when your bank account feels tight.

Understanding how your purchases and decisions affect both your business operations and your taxable income is key to building a smart, profitable strategy.

10/30/2025

Homestead CFO 60: Understanding the Financials

Profit and loss (Income Statement)
Think of this like your birthday. It tracks your business's income and expenses for the year and then resets when the next birthday (New Year) comes around. It shows how much you earned and what it cost to earn it.

Balance Sheet
This one's your life story. It list everything your business owns, owes, and has built up since day one. Its the big picture of where you stand right now.

Cash Flow
Think of this like your bank statement. It shows where the cash is actually going, whats coming in, what going out, and whether your business is growing stronger or running tight.

When you understand all 3, you begin to understand these numbers tell the story of your business and where its headed.

Send a message to learn more

10/30/2025

This page is dedicated to delivering accounting value and financial insight for business owners looking to take control of their numbers.

Homestead CFO 60 is a quick-hit series for small-town business owners who want to understand their numbers, make better decisions, and keep more of what they earn — all in under a minute.”

Send a message to learn more

10/17/2025

Formerly Virgin Consulting, LLC, we are strategically restructuring to enhance our services and deepen our connection with our customers.