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Taxes for a small business

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Running your small business can be challenging enough, not to mention the burden of doing your small business taxes. Fortunately there are ways to make your small business taxes easier to do and easier to manage. The IRS provides information on their website for small and growing businesses and how to pay your business taxes. The IRS also has some valuable tips on getting small businesses off the ground with checklist for your business tax account. Tax deductions can be tricky and if done properly they will keep more money in your business tax account to pay quarterly taxes for the next year. The last thing you want is to misuse your business tax account and have problems with the IRS. Take time to find the best business team you can by hiring a good bookkeeper or accountant and making a thorough decision about paying your business taxes.

Bookkeeping should be at the top of your priority list when running a small business. Regardless of any size, every business needs to have bookkeeping! Proper bookkeeping will not only help you make operational decisions, but it will establish compliance with IRS regulations and bank rules.

An easy way to pay your quarterly and yearly businesses taxes is to set up a business tax account. Here are some steps you can use before you set up your business tax account:



  • Update Your Accounting. At the end of the year, you must know your companies financial situation. Spend time with your accountant to be sure all the books are up to date and accurate.

  •  Defer Income. If you can, hold off on receiving money till the first week of January as opposed to December. If you receive the money in January versus in December, you will not have to pay taxes on that money until April of the next year.

  •  Increase Expenses. This sounds silly, but increasing the amount you purchase will help to maximize deductions for the tax year. Office Supplies, Equipment, Travel and paying your bills early all add up for deductions.

  •  Inventory. Always check your inventory for damaged goods or obsolete products. Added deductions come from the drop in market value of your inventory.

  •  Retirement Plan. Making payments to your retirement plan will help reduce your income for the year. Discuss the best strategy with your accountant or financial planner.

Once you have your accounting in order, you can begin preparing your business taxes. You must first have your employer ID number ready and you must know the type of corporation your business is. Some businesses are called an "S-corporation" and they require different taxes than a self-employed individual. Be sure to research all this information before you start printing out random forms. The irs.gov website is a great tool for a business leader who is looking to take care of the business taxes in house.

Small businesses have several tax deductions available. Keeping proper records of anything that pertains to your business will help your taxes. If you are tracking your own records, try using a financial program that will help. Many companies use QuickBooks to track their expenses. QuickBooks also provides information you will need for filing your tax returns. If you choose to do the business taxes yourself, you should purchase TurboTax or another tax program that will guide you through every aspect of your business. It also allows you to have an accountant check over your taxes when you have completed them to make sure everything checks out alright and you won't be at risk for being audited.

If you are ever weary about doing your small business taxes, you can hire a tax accountant to do them for you. They may cost a lot, but it will be cheaper than paying the IRS if you are audited!

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Categories: Accounting, Budget, Small Business, Tax,

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Posted by DF
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