Apr 26 2019
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5 Small Business Tax Mistakes That Are Easy to Avoid

By qSdCcPjb

For most small businesses, tax season 2019 has officially come to a close. However, if you’ve filed for an extension or had such a difficult time with your taxes that you’re planning ahead for next year, then taxes are probably still at the forefront of your mind. Tax season can be incredibly stressful for small businesses, especially with tax laws being so complicated. This opens the door for mistakes that can cost small businesses money and increase the chances of undergoing a dreaded audit. If tax preparation is keeping you up at night, here are five of the most common tax mistakes small businesses make and how you can avoid them. Inaccurate Reports of Income For small businesses that have their hands full of juggling a ton of responsibilities, accurate record keeping can easily fall to the wayside. This is problematic because it can lead to inaccurately reporting income to the IRS. This is an offense that the IRS takes very seriously, even if it wasn’t intentional. You’re probably not going to receive a serious penalty for an honest mistake, but you will likely have to pay the amount due plus some significant fines. To eliminate the potential of inaccurate reporting, maintain accurate records of all income for your business, and don’t save updating your records for the week before the tax deadline. Filing Late Due to Lack of Funds If you know that you’re going to be late filing and paying your taxes, it’s important to file for an…

Jan 30 2019
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The 2019 Tax Changes That Will Affect Your Business

By qSdCcPjb

If you’re a small-business owner, you’ve probably heard of the 2018 tax bill—also known as “Tax Cuts and Jobs Act.” This bill has not only changed individual taxes, but it’s also reformed corporate taxes in the U.S.—especially for small businesses. Here’s what you need to know: The new pass-through income deduction Originally touted as the tax break that would provide relief for small business owners, a 20% deduction is included in the bill for what they call “pass-through” income. This encompasses any income you receive from pass-through entities, including sole proprietorships, LLCs, partnerships, and S-Corps. Other types of income that are included under this umbrella include estate income as well as any dividends you may receive from Real Estate Investment Trust, or REIT, stocks. That said, there’s one restriction that you should know about: the Tax Cuts and Jobs Act places a cap on the maximum amount of income that any people who work in what they deem “professional services” businesses (think lawyers, doctors, or consultants) can earn if they want to utilize this deduction. This pass-through deduction for professional services business will take effect for the tax year of 2018; people with AGI greater than $157,500 (single filers) or $315,000 (married filing jointly) will be impacted. Tax Deductions That Are Gone Many long-standing tax deductions managed to survive the processes that brought the latest tax bill into being—  some with modifications, some in their original form. However, not every tax deduction made the cut, so to speak. After all,…

Dec 21 2018
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3 Year End Tax Tips For Small Businesses

By qSdCcPjb

It’s that time of year again. Time to review the past year and identify strategies that worked and the ones that didn’t.. A time to start forecasting for the future, referring to actuals for reasonable budget estimates. A time to cash flow annual employee bonuses. Yes folks, it’s year end. These are things most business owners are thinking about as December 31st or fiscal year end approaches. But one thing that’s often overlooked is what needs to be done to optimize the company’s position when it comes time to file the tax returns. We’ve put together a list of three year end tax tips to help you get your financial house in order ahead of tax season. Let’s dive in! Year End Tax Tip #1 Don’t Skip Meeting With Your Accountant If you do nothing else, set up a meeting with your accountant to discuss tax strategies before year end. Why? Because with a little forecasting and tax planning, you could save your company thousands of tax dollars (and penalty payments), and you can do some cash planning to avoid a crunch in Q1. Tax Deductions Your accountant is up to date on all the current tax laws, including ones that allow certain advantageous deductions of which you may not be aware. Know what your options are if you’re planning to buy equipment in the next few months. It may make sense to purchase it before year end and take the depreciation, or it may make sense to wait until…

Aug 24 2018
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NOW Is the Best Time for Business Tax Planning to Save On Taxes

By qSdCcPjb

Alleviate anxiety and panic later on in the year and help your business’ bottom line by prepping for tax season early. The best way to save money on your taxes is to get started on them well ahead of time. Plan Your Approach Timely tax planning is the secret to success come April 15th. When it comes time to file your taxes, the first thing you need to do is get your records in order. This can be a herculean task if you haven’t organized paperwork since the last time you filed your taxes! The best thing to do is to establish a system that you can adhere to with a modest amount of effort the whole year through. It’s also important to know in advance some of the deductions you’ll be planning on taking. One of the most illuminating examples is that of business-related expenses for your vehicle. If your personal vehicle doubles as your work vehicle, you can deduct business-related travel expenses. There are two ways you can file for this deduction. Each year, the IRS puts out standard mileage rates—what it considers to be the cost of operating an automobile for business. In 2018, that rate is 54.5 cents for every mile of business travel driven. However, you have the option of calculating the actual cost of using your vehicle. Keeping careful track year-round will allow you to choose the method that results in the larger write-off. Keep Careful Records Income, expenses, receipts—it all has to be…

Jan 28 2018
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6 Tips to Make Tax Time Easier for Your Business

By qSdCcPjb

The beginning of the year is marked by a few familiar occurrences: ambitious resolutions, discounts on gym memberships, and tax forms arriving in the mail. That last one can cause a bit of panic, especially for small business owners, as they signal the looming arrival of everyone’s least favorite time of year: tax time. The next few months are often characterized by procrastination and a mad dash to file your return on time. But while that may be the norm, it doesn’t have to be. We’ve assembled some tips that will help you breathe a little easier when tax time comes around. Plan All Year The fact of the matter is, taxes are a concern year-round. It’s just that they fall off the list of concerns. To get a handle on your taxes, it’s important to first change your perception of them from “once-a-year annoyance” to “ongoing business concern.” As a small business owner, you’ve got a lot of ongoing business concerns, and they all get handled. Making taxes “part of the routine” helps take away their threatening air. Another benefit is that you’ll undoubtedly file your returns more competently. By rushing to file your taxes at the last minute, you’re bound to miss a few deductions. Keeping them in mind all year long will help you see the opportunities you might otherwise miss. Prioritize Organization and Consistency The key to getting your tax preparation efforts going is to create a consistent organizational system. Maintain receipts and keep on top…