There are more than 32 million small businesses just in the US and more join their ranks all the time. While every business must cope with the unique challenges of their industry and location, all businesses must also deal with common problems and expectations.
Every business must deal with issues such as payroll, staffing, and doing taxes. Of course, managing your small business tax obligations can prove challenging for those with little or no experience. Tax regulations change on a regular basis.
If you’re worried about doing your taxes, keep reading for some essential tips for handling them.
Keep Good Records
One of the best pieces of tax advice out there is that you should keep good records. In fact, you make setting up good record-keeping practices one of your first orders of business.
Keeping good records means you update them regularly. It also means you keep them organized. It’s always easier if you set up a system from day one than trying to organize the records later.
Stay on Top of Bookkeeping
Bookkeeping is one of those tasks that many small business owners truly detest. Yet, you’ll need those books up to date at least once a year if not quarterly when filing taxes.
If you find the task truly tedious and avoid it, hire a bookkeeper. Even a part-time bookkeeper can help keep you on track and make sure you don’t miss important errors in your books.
Know All of Your Tax Liability
It’s important that you know all of the taxes you must pay. For example, most business owners know they must pay things like income tax and sales tax, assuming your state uses sales tax.
You may also find yourself on the hook for property taxes, excise taxes, franchise taxes, and payroll taxes. Knowing what you must pay helps you set aside enough money over the course of a quarter or year that you won’t come up short when those taxes come due.
Hire a Pro
Truly small businesses like one-person freelance operations can often get away with filing their taxes themselves. It’s typically just an extra form attached to their 1040. If your taxes get much more complicated than that, though, you’ll want help from a tax company or tax professional like Christopher Klug.
Tax services can help you find deductions you might not know about, handle depreciation schedules, and ensure the forms get filled out properly.
Small Business Tax and You
Handling your small business tax obligations isn’t something you can deal with at the last minute. You must plan for it from day one.
You need solid, organized records that you can give your accountant or show tax agencies. Letting bookkeeping slide indefinitely isn’t an option. You must also know what taxes your business must pay each quarter or year.
When in doubt, use the services of a tax professional. If nothing else, you buy yourself a little peace of mind.
Looking for more business finance tips? Check out the posts over in our Business and Finance sections.