COVID-19 and Profit First
It seems the only news topic right now COVID-19. The situation in the US is rapidly changing. In fact, my kids school district just announced they would be closed until April 14th–the day before the current tax deadline. Yikes! (I say “current deadline” because although there isn’t an official announcement yet there is talk about automatic extensions, more time to pay, payroll tax breaks, etc.)
Most of our clients aren’t even thinking about looming tax deadlines right now, they’re scrambling to set up telehealth, update their patient paperwork and policies, and just dealing with the overall uncertainty in the economy. Everyone is making adjustments to their work and learning how to do more things remotely than ever before. It’s been quite a ride!
In times like these, I take comfort in knowing how many of our clients have implemented Profit First and knowing that they are ready to weather the storm. Even if they see a reduction in the number of clients they see each week, I know they have a Vault account for emergencies, and a Profit account that they can tap into as a backup. I know that the funds in their Tax accounts will probably not be used until later in the year so we could also tap into that as well. (I’m making the assumption that there will be some kind of penalty-free extension, although keep in mind that’s not official yet). If you’re a Profit First super-fan you know we’re normally not supposed to borrow from other accounts to cover operations, but nothing seems normal right now.
If you’ve been thinking about implementing Profit First and just haven’t gotten around to it yet, we’d love to help when the dust settles. Setting up safety nets can help your business when these strange and difficult times hit. If you’re staring down a dwindling bank balance and not sure how you’re going to pay your overhead and your clinicians, implementing Profit First can mean you’ll never be in this place again.
Keep up the good work! With all the anxiety COVID-19 is producing we’ll need strong mental health services in our communities more than ever.
This article is designed to provide information only and should not be considered legal or tax advice. Because of the complexity of the law and the variables in your own personal tax situation, you can’t rely on our advice specifically related to your unique circumstances. In order to get the best tax savings and legal advice available to you, you should consult with your own accountant, attorney or advisor regarding your particular facts and circumstances. GreenOak Accounting is an accounting firm that specializes in working with counselors and therapists in private practice. We provide monthly accounting & bookkeeping services, 1-time services and online courses. For more information on our specialized services for therapists please visit https://www.greenoakaccounting.com