Tips for Handling Small Business Taxes

Posted on April 5, 2016

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Small Business Taxes Can be Streamlined When You Follow a Few Simple Guidelines

small business taxesTax season is a dreaded time of year for many business owners. Small business taxes require careful record-keeping, and with all the hats you wear, you may get to tax season realizing you weren’t quite as diligent as you’d hoped. Faced with a pile of receipts and poorly-recorded notes, you may resolve, year after year, not to go through it all again.

With a few simple guidelines, small business taxes don’t have to be so frustrating. If you’re looking for a few small changes that will make a big impact, take a look at the following tips:

Plan ahead for estimated taxes. A big challenge for small business owners is the need to come up with funds to pay estimated taxes each quarter. One way to overcome this problem is to routinely pay into a business account that is used solely for paying estimated taxes. You can also set up an account with The Electronic Federal Tax Payment System, which can automatically deduct the amount of your estimated payments from the business account.

Schedule a monthly financial records meeting. Setting aside time each month to reconcile receipts with expenses and clear up any other financial questions is a big step to getting control over your small business taxes. Facing down a box full of receipts in January or February relies heavily on your memory for where money was spent. If you handle it each month, you’ll clear up confusion before the event is forgotten.

Think strategically about how you compensate employees. If you have an employee that does a great job, your first thought about how to reward them might be a raise. However there are other options that ease the burden on your tax bill, such as additional health-related benefits or child care assistance.

Make sure you have the necessary employee documentation. Set aside time to look through your employee records. Do you have a W-9 on file for each employee? You will also need accurate information from contractors. These two pieces of information will help you meet requirements for getting W-2s and 1099s distributed on time when you get to the new year.

Do an end-of-year check-up on your tax situation. When you are planning your calendar, be sure to schedule a time in October to review your tax situation. It may be a good time to do additional spending or make other changes to reduce your tax burden.

Bert Doerhoff, CPA, and the team at AccuBiz have extensive experience working on small business taxes with companies like yours. If you want more information about how to make completing small business taxes easy and painless, consider the services of AccuBiz. From payroll to full service accounting, AccuBiz offers a variety of services for small business needs.

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Posted in: Small Business