A Guide to Small Business Tax Prep and Deductions
Written by Eddy Hood
One of the most critical things you must do when running a small business is file and pay your business tax. Small business taxes can be intimidating because (let's be honest) the IRS can be intimidating, and business owners are often confused about where to begin. Unless you're a CPA yourself, taxes might not be your forte, and besides, you have a business that takes up most of your time. You might have your general bookkeeping under control, but are you ready to claim all of the small business tax deductions you're entitled to when it's tax time? Ignite Spot can help make certain that you are.
Your Tax Obligation
As you stare helplessly at the mounds of rules and regulations surrounding small business taxes, you might feel as if it's better to shut your doors or, worse, stick your head in the sand and avoid your tax obligations. The latter is definitely not an option; it's not worth the late fees, fines, and (yes) possible jail time you might face for failing to file and pay your business income tax. You could lose everything, including the business you've worked so hard to build in the first place. Small business tax preparation really isn't as difficult as it might seem, and you can move forward and fulfill your tax obligations without a hitch.
Some basics to keep in mind are:
- Select your business structure, as this directly affects how you will prepare and file your taxes. You have the option of running a sole-proprietorship, partnership, S corporation, Limited Liability Company, or corporation.
- Your business structure also affects your tax structure and when you pay them depends on whether you're a sole-proprietor, partner, or so on. For example, sole-proprietors file and pay quarterly tax, whereas corporations are allowed to pay tax annually.
- If you have employees, you must pay employment tax, including Medicare and Social Security. You must also submit W-2 forms to your employees for their tax filings. If you hire independent contractors, you must send them 1099 forms.
- Keep track of your business expenses, as the costs to operate your business might make you eligible for business expense deductions.
These are just some of the things you must consider and do to maximize your small business tax deductions.
Ignite Spot Can Help
Still feeling a little overwhelmed? This is where we come in. Ignite Spot Outsourced Accounting has a team of professionals ready to help you with your business tax filing needs, and we don't mean just filling out the forms and submitting them to the IRS for you. We take a comprehensive look at your entire business operation with the primary focus of finding ways for your business to reduce its debt and overhead to have more income to accomplish the goals set forth in your business plan.
Our firm offers financial services that are designed to address your whole picture, not just the difference between debits and credits. We understand what it's like to run a small business, and from deciding the business structure that's right for you to filing your taxes, we are here to help, so please download our pricing online or contact us today.
Learn More About Our Tax Services
- What is the Federal Unemployment Tax Act (FUTA)?
- Understanding Self Employment Taxes
- How to File Self Employment Taxes
- Tax Implications of The Affordable Care Act on Small Businesses
- How to File Small Businesss Taxes
- Self Employment Tax Deductions
- What is a Tax Write-Off?
- Small Business Tax Write-Offs