Filing and paying taxes is a part of doing business, but as a small business owner writing the check is often the least painful part of the process. Filing tax forms is a real hassle if you leave it until the deadline is staring you in the face.
If you don't have a back-office staff, you'll be the one gathering all the information you need to satisfy the IRS, consuming time and resources you don't have. But it doesn't have to be that way. Preparing for tax season isn't a one-time event, it's a continuous process. If you start now, you can avoid the last-minute scramble. Outsourcing your bookkeeping needs is a good first step to getting a handle on your taxes. But if you want to do it yourself, here are some other tips:
If you don't have a back-office staff, you'll be the one gathering all the information you need to satisfy the IRS, consuming time and resources you don't have. But it doesn't have to be that way. Preparing for tax season isn't a one-time event, it's a continuous process. If you start now, you can avoid the last-minute scramble. Outsourcing your bookkeeping needs is a good first step to getting a handle on your taxes. But if you want to do it yourself, here are some other tips:
Choose a software – Choose an accounting software to help you track income and expenses. There are several online accounting programs to choose from and most of them work with apps and add-ons to further help your business get organized.
Obtain an EIN – If you have employees this year, you will need an employer identification number (EIN). This number is how the IRS identifies your business on your own tax forms as well as your employee’s tax returns.
Save receipts - Get a receipt for every purchase the business makes, no matter how small. Don’t forget to get a receipt for any businesses purchases made from your personal accounts as well. Small expenses can add up to big deductions and every little bit helps.
Separate business/personal expenses - Pay for your business expenses with a credit card or bank account dedicated solely to the business. Avoid using this account for personal expenses but if you must make a personal purchase, make note of it on the receipt.
Get organized - Set up a simple filing system for your receipts. File receipts immediately or on a regular basis such as weekly; this minimizes the risk of losing a receipt. When tax time comes, you will have all your documentation of expenses easily available, without having to search through a pile of paper.
Obtain an EIN – If you have employees this year, you will need an employer identification number (EIN). This number is how the IRS identifies your business on your own tax forms as well as your employee’s tax returns.
Save receipts - Get a receipt for every purchase the business makes, no matter how small. Don’t forget to get a receipt for any businesses purchases made from your personal accounts as well. Small expenses can add up to big deductions and every little bit helps.
Separate business/personal expenses - Pay for your business expenses with a credit card or bank account dedicated solely to the business. Avoid using this account for personal expenses but if you must make a personal purchase, make note of it on the receipt.
Get organized - Set up a simple filing system for your receipts. File receipts immediately or on a regular basis such as weekly; this minimizes the risk of losing a receipt. When tax time comes, you will have all your documentation of expenses easily available, without having to search through a pile of paper.
Plan ahead - It's a good idea to set aside money from the business each month to cover taxes. Talk with your CPA to estimate your tax bill for the year based on income and expense projections.
Remember deadlines - Just like any important date, you should keep track of any IRS deadlines you'll need to meet. Mark them on your calendar, along with any extra time you'll need to prepare.
Few people find tax season to be fun, but for the rest of us it doesn't have to be torturous. You can prepare for next year with the above tips or you can save yourself time, money, and in many cases, undue stress and frustration by outsourcing your accounting and payroll.
For more help on getting organized or if you're considering outsourcing your accounting and payroll, please contact us at [email protected] or call 800 901-3006.
SimpliNumbers is a professional online bookkeeping and payroll services firm run by a talented team of professionals. With a combined experience level of over 40 years, we provide high-quality, innovative services to small businesses.
Remember deadlines - Just like any important date, you should keep track of any IRS deadlines you'll need to meet. Mark them on your calendar, along with any extra time you'll need to prepare.
Few people find tax season to be fun, but for the rest of us it doesn't have to be torturous. You can prepare for next year with the above tips or you can save yourself time, money, and in many cases, undue stress and frustration by outsourcing your accounting and payroll.
For more help on getting organized or if you're considering outsourcing your accounting and payroll, please contact us at [email protected] or call 800 901-3006.
SimpliNumbers is a professional online bookkeeping and payroll services firm run by a talented team of professionals. With a combined experience level of over 40 years, we provide high-quality, innovative services to small businesses.
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