With the new year officially here, it’s only a matter of time before we’re all in the midst of the tax time rush. Last-minute number crunching can be stressful, both for business owners and their tax professionals. We have some basic and simple ideas to help ensure you’ll be prepared for tax season so that your filing process goes smoothly.
Hopefully you’ve been keeping tabs on your business’s performance over the last year. Documenting and analyzing financials each month gives you an idea of the health and profitability of your company.
Bring those records as well as any receipts for business expenses when meeting with your tax professional. Keeping your documents together will help ensure you have the information your tax preparer needs when he or she prepares your tax forms.
Sometimes the line between business and personal expenses becomes blurred, especially for small business owners. Be sure to go through your expenses and determine which one goes where. Double check your personal account for business expenses you may have forgotten.
Also, the IRS has specific rules for Section 179 deductions. This allows you to deduct the cost of certain property as an expense when the property is used for your business. You may not be aware of which property does and doesn’t meet those guidelines. But as a business owner, you know better than your accountant which assets are used and how they were acquired. Have information ready on any tangible and purchased assets so your tax professional can determine whether they qualify.
April 15 has been the tax deadline since 1954. While in some cases it is possible to file for (and get) an extension, there is a penalty for not filing taxes on time. If your business fails to file by the deadline, you are required to pay 5 percent of the unpaid tax for each month your return is late. Further, if your owed tax is late, that penalty is half a percent of the owed amount every month it remains unpaid.
Additionally, hurried filing can lead to possible inaccuracies or missed documentation. And monthly monitoring will help you know where your business stands, so you’re not shocked by a massive tax bill or can better plan for making estimated tax payments.
Avoid any unnecessary penalties, potential oversights, and surprises by planning ahead. Leave enough time to get your documents in order and to meet with your accounting professional prior to the tax deadline.
Again, these are just a few of the simple things you can do to be prepared for tax season. At Barton, Walter & Krier, we know each business and situation is unique when it comes to filing. Our tax professionals will work with you to get your tax return completed accurately and on time. Contact us today to schedule your appointment.