Meeting with CPA

My wife and I met the CPA at her office late Friday afternoon. The night before, I have gone through all my documents for House #1, and packaged them into a large folder. The meeting lasted for almost two hours. I showed her all the receipts I kept on the house for repairs and whatnot. I also gave her a copy of the spreadsheet I use to track my mileage for the business. She said if it is a good idea to run weekly/monthly backups on my mileage spreadsheet, since it is in electronic form. This way, if we ever get audited, it better proves an historical reference. She says if I only have the one copy and no backup, the IRS can (and will!) say I conjured the whole thing up the night before the audit. Good point, I suppose. Lucky for me, I have made a few backups of my entire hard drive directory where I keep all my electronic files of the business. I then gave her the original closing statement, the refi closing statement, and document after document regarding the House #1. She made a copy of everything, and then asked me if I have paid the insurance for the property. For some reason, I completely forgot all about the insurance document. There were a few more receipts and papers I needed to get on top of the proof of insurance form, so I'll get that to her at a later date. All-in-all the meeting went well, and both of us came away satisfied that we had a good professional CPA on our team.

I did bring up the fact about creating an entity and the CPA seemed a little hesitant about creating one right now. She said in order to get everything under the new entity, I would first have to go through my insurance agent and lender to make sure they were okay with the transfer (which I knew already). She said for this one property, I could still do it, but it may be a little overkill right now. She also mentioned that it could even hurt me financially to transfer things over to the business right now (ie, taxes, new loan rates, and some other issues), but she would check into it and get back to me. So for now, I am still managing the business under the guise of a sole proprietor.

She also mentioned that it would be a good idea to establish a firm basis in our house to be used for business pruposes only. We told her we bought some equipment for business use, and work out of boxes mainly right now. She siggested getting a desk and filing cabinets for the business and writing them and the physical area (and all it entails: utilities, phone, internet) as a business tax write-off. This is something else we need to do.

One big to-do scratched off the list. :-)