Whether you’ve been in business for a while or you are a first year filer, filing taxes for your business is mandatory but not the most fun experience. There are things you can do throughout the year and at tax time to make this less of a chore.
During Your Business Year
Keep good records. This is the biggest and most important step of preparing for taxes. Keeping good records of what you have spent money on, what money you have brought in, and other important information will allow you to prove to the IRS you are eligible for deductions/tax credits. Without proper documentation you may miss out on this extra money. Keeping your records organized will save you time searching or sorting during the filing process.
Know your type of business. If you have been filing for years, you should have this information! For a new business this is the first step to filing properly. Different types of businesses not only pay different taxes but require different documentation to do so. Is your business a sole proprietorship, partnership, corporation, etc? The IRS website can help with guidelines to determine where your business fits.
Acquire your employee identification number. If you need one of these, waiting until it is time to file your taxes can postpone the process while you wait to be assigned one. You can apply for these online so when you’re ready to file you have it.
Getting Your Money
Receiving your refund back as quick as possible can be important to your business, and waiting 6 to 8 weeks for a paper check to be mailed may not be practical. Direct deposit can speed up the process, but you are still waiting 2 to 3 weeks before you receive your refund. There are businesses, such as Power Finance, that use advanced loans to help you get money for your business until your return comes. You then pay that company back when your paper check comes in the mail. Have your refund in your hand within a day or two of filing!
How To Be Consistent
Using an accountant can ease the pain of filing. Accountants are trained professionals and using the same one every year will ensure consistency in your returns as well as being confident the rules of the IRS are followed. The accountant will have your previous year’s records to make filing this year a breeze.
These tips can help make filing taxes a simple process for your business.