Starting A Business? A Few Tips To Make Your First Business Tax Preparation Easier
Posted on: 13 June 2016
Preparing taxes can be a stressful chore for anyone, but when it comes to doing a business tax return, things get even more stressful. It won't matter whether you are doing the return yourself or paying a professional to do it for you. However, if you are starting a business, there are some things you can do throughout the year to make everything much easier when you go to file your taxes. Here are just a few tips to help you get through the next tax season with all your hair.
Understand What Taxes Need to Be Filed Throughout the Year
Whether you are a sole proprietor or form a corporation for your business, there may be taxes that need to be filed quarterly or more often throughout the year. You do not want to get behind on these taxes and wait until income tax time to find out you now owe a lot more in fines and penalties. The important taxes that can affect your annual business tax filing include sales tax and employment taxes. You want to be sure your business income tax shows the same amount of sales and any employment expenses as what was reported each quarter. Good record keeping will ensure everything is right.
Understand Your Deductions
If you use your own vehicle for business (more than just driving to and from the office) be sure to keep track of every time you do. Keep a record book to show when, where, and how far you traveled for business, and be sure to save any gas receipts. Find a place in your home where you can do business. Be sure that area is not used for any other purpose and you can use that portion of your home as a deduction. This could be half a room set up with a desk, or a garage used to store inventory. Talk with a business tax preparation specialist to find out what other types of deductions may be available for the type of business you are starting.
As soon as you think about starting your business, begin keeping records, keep receipts, and make sure everything is documented. You want to be sure that you can deduct everything allowable and that you have all that is needed when it is time for business tax preparation. Keep everything organized by type of expense and date, and the tax season won't be a problem at all.
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