Whether your small business has a great fall season or slows down, thinking about tax preparation probably falls to the bottom of your to-do list faster than the leaves fall to the ground. But this new season means that the holidays will come and go, winter will be over and tax season will be here once again before you know it. Rather than putting your tax preparation off until the new year. There are some easy tax tips for small business owners that will make tax season much easier.
Create a Checklist
Leaving something out or having an error on your tax return can cause your small business to lose money and may result in you losing precious time. To avoid this, it’s best to write out or type up a list of all the items that are important for filing your business’s taxes. This will include, but is not limited to, the following:
- Filing payroll forms
- Submitting 1099 forms to certain employees
- Putting together income and expense records
- Collecting expense records
Get Everything Organized
Almost every business owner has dealt with the stress of taking care of business taxes at the last minute of tax season, but there’s no need to put this additional stress on your already full plate. Instead, now is the time to prepare yourself tax filing—you can do this by making sure your bookkeeping is up-to-date, putting all of your tax-related documents in the same place and organizing the receipts that have accrued over the course of the year. In addition making sure your accounting software is up to date including all bank reconciliations have been done timely.
Be Aware of Deductions Eligibility
Far too often, small business owners miss out on tax deduction opportunities, meaning they also miss out on the opportunity to put more money into their pockets. The following is a list of popular small business tax deductions that may apply to yours:
- Expenses for your home office
- Costs from starting up your business
- Office supplies
- Office furniture
- Office equipment (may include cell phones used for business)
- Mileage from transportation to job sites, client visits, etc.
- Costs from business trips (flights, car rental, meals, etc.)
If you are unsure of which tax deductions your small business is applicable for, now is the time to contact a tax services professional.
Handle Things Early to Maximize Deductions
By “things” we mean spending more money throughout the fall to help maximize your deductions. If your small business is financially stable, then you may want to consider taking care of the following expenses prior to December 31, 2019:
- Paying vendors
- Paying advertisers
- Leasing a vehicle
- All employee bonuses paid before year end
- Purchasing new equipment
Although all of these options will cost you, it will make a big difference in your tax refund (in a positive way).
Whether you need assistance with tax preparation by getting your bookkeeping in order, or you need the help of a tax services professional, the team at SD Associates in Elkins Park, PA is here for you. Contact us today to schedule your appointment!