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Tax Season Tips for Small Business Owners

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Tax season is a stressful time for nearly everyone. Due to the monotony, employees put off filing, accountants bend over backward to file for their customers, and business owners triple-check payroll, accounts, and booking. If you’re a business owner and preparing to file, consider these tips before submitting your return to the IRS.

  • Ensure your data is up-to-date
  • Organize and gather receipts and records
  • Check for forgotten expenses or events
  • File the correct forms for your business
  • Factor in retirement savings
  • Give taxes your undivided attention
  • Plan for next year

Ensure your data is up-to-date

Make sure your financial records are up to date before you begin filling out tax forms. All booking records should be finalized by the end of the previous year. Be sure to submit any outstanding payments, taxes, and deposits, so your business’s tax return accurately reflects the last year.

Organize and gather receipts and records

If you kept your invoices, payments, payouts, expenses, and payroll organized from the previous year, you’re off to a good start. Gather the appropriate spreadsheets, receipts, and other information you’ll need to make completing the tax forms a slightly more manageable task. Many credit card companies can provide an annual summary of your account activity. An annual summary combined with monthly card statements can provide a detailed breakdown of expenses paid. 

Check for forgotten expenses or events.

Take a look through your calendar to see if there are any events or expenses you forgot about. Perhaps an unexpected runout to a client to take about a new feature? A charity event you sponsored? Double-check for any forgotten deductible expenses. 

File the right forms for your business

The IRS provides information on the appropriate forms to file for your business on their website. For example, sole proprietorships will file a different form than corporations. Using the proper form for your business will ensure you file other supplemental forms (like those for deductions!) to complete an accurate return.

Factor in retirement savings

Retirement payments are tax-deductible. You can contribute to a retirement savings plan until April 15th, 2022, and enjoy the tax benefit for the previous year. You can also make a tax deferral on the contributions you make to your account. Take note of the limits, but retirement planning is good for business both now and in the future. 

Give taxes your undivided attention

Carve out time to solely focus on filing your business tax returns. They’re essential, and it’s not worth getting distracted by social media, emails, or coworkers and risk putting a wrong number in the wrong box. Stay focused! 

Plan for next year

As you file this tax season, were there any hurdles you faced that you felt were unnecessary, or could at least be improved upon coming next year? What data was hard to find? What were reports difficult to compile? An outdated payroll processing software has the potential to make filing taxes an even more arduous task. Efficient, streamlined payroll software has the potential to slash hours spent toiling over business taxes. Request a demo below if you’re ready to see how intuitive payroll software can improve your business processes!

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