You can do everything right in your business, but if you mess up on your taxes it could be in trouble.
How to make tax season a breeze for your business
The IRS isn’t kidding around when it comes to paying Uncle Sam, and this makes many businesses unsure of how to avoid overpaying or underpaying the government, much less how to prepare for tax season in the first place.
If this sounds like you and you’re feeling overwhelmed, you don’t have to be.
There are some simple tricks that will put you in a great position to get through tax season without a scratch:
Know your business
Did you know that 70% of businesses didn’t pay income tax last year? Does that mean that they didn’t make any money?
No absolutely not.
It means that they understand what kind of business they have legally in the eyes of the IRS.
Therefore, they structure their assets in a way that allows them to report zero profit in many cases.
This might not work for your business, but there are no doubt options to pay less, legally, than you are now.
And when every dollar saved could turn into 10x or 100x that amount if you invest it in growing your business, don’t leave anything on the table.
Whether you are in need of a Forbes 100 or a non-profit accounting expert, you can find them by asking around or using freelance websites.
Make sure your accountant has a stellar reputation and that they have experience in your industry.
They can often find loopholes that you weren’t aware of, and you could find yourself paying much less than you thought possible.
But don’t leave your accountant hanging.
Use software throughout the year that tracks your finances so you can offer them a set of information that is easier to manage and report on.
Honesty is the best policy when it comes to business taxes.
Regardless of how irresponsibly the government spends most peoples’ tax money, it doesn’t change the fact that your business’ legal status could be in jeopardy if you decide to get one over on the tax man.
So absolutely pay the least amount that you can using legal means, but don’t purposely withhold information or give false information on your taxes if you want to stay out of trouble.
Follow the IRS and stay up to date
The IRS regulations don’t read like a modern day sitcom or even a great American novel. They are dry and boring, but so what? That doesn’t reduce the value that they hold.
Every time the IRS changes something, view it as an opportunity to improve your business and save it money.
Stay abreast of the rulings and you’ll soon have less stress and more left over in the company bank account after the season ends.
Make a habit of keeping records of all your spending.
If you think your computer isn’t a big deal, you could be dead wrong. It might be a complete write-off. Even your personal vehicle can act as a tax break if you use it for work a certain amount of time each year.
Leave no stone unturned when protecting your business from taxes.
Plus, by having it all in one place you can enjoy higher organization and less time when it comes time to deliver it to your accountant.
When the IRS dismantles and the government no longer expects people to pay taxes, then your worries will be over on that front.
Until that day, you will need to do your best to prepare for the tax season.
Not only do you stand to miss out on tax breaks if you don’t prep the right way, you could also overpay or worse: underpay and end up dealing with the IRS’ legal arm.
So do yourself a favor this tax season and put the advice above into place so you can relax this time around instead of fretting.
Your wallet and your nerves will thank you.