Tax Preparation Tips for Small Business Owners
Like most private citizens, small business owners generally have a dread of the approaching tax season, when that time of year rolls around. However there are some things you can do for tax preparation, so that much of the anxiety and stress can be relieved, and so that you can keep focused on what really needs your attention, which is running the business.
Trying to get organized a month before you file your taxes is never a good idea. A much better tax preparation approach would be to stay organized throughout the entire calendar year, so you can avoid the dread of tax season. Staying organized all year requires that you keep detailed accounts of your expenses, follow up on invoicing every month, and document all items which you expect to declare as business deductions.
This is actually an extension of the first point above, since it requires that you reconcile with your bank on a monthly, if not weekly basis. This is a very important activity to undertake, because it matches bank transactions to lines in your accounting system, so that you have no glaring omissions or unaccounted details.
Review quarterly payments
If you make a practice of submitting estimated quarterly tax payments, these should all be carefully reviewed at the end of the year, to ensure that your estimated payments match up well with actual payments. This should also tell you how much of a tax refund you might be entitled to.
Make sure W9’s are in order
If yours is a business that involves the use of contractors, you should have issued each contractor a W9 form for their services. If you haven’t done that, you can still do it at the end of the year, so that it can be submitted by those people whom you’ve worked with.
Schedule an appointment with your accountant
Don’t wait until the week before to contact your accountant for setting up an appointment, because chances are he/she will be booked solid at that time of year, and you’ll have to wait. A good tax preparation practice is to book your appointment about a month early or even more, so that you can be sure of getting in quickly, and having your entire tax situation reviewed.
Owe money at tax time? Contact FinCentral Capital
Tax time can be very stressful for small business owners, especially if you should discover that you owe the government money. Contact us at FinCentral Capital to discuss options for securing the funding you need to get through tax time and keep your business on track afterward.