Tax Planning Tips for Small Business Owners (1)

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Tax Planning Tips for Small Business Owners
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• Tax season is the one time of year that small
  business owners dread the most, but pushing
  thoughts of filing requirements and deadlines to
  one side, will only make matters worse.
• Tax planning, if kept up to date throughout the
  year rather than just during tax season, can help
  you sail through your returns instead of wading
  through them, and here are six top tips to help
  you plan your taxes

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• 1. Start planning early During the day to day
  running of your small business, it can be easy to
  forget about filing receipts and financial
  paperwork as you go along, but this really is the
  best way of keeping on top of things. If you
  cant do it every day, try to dedicate a certain
  amount of time to it each week or month, and make
  sure that everything is labeled clearly and filed
  in a workable system. If youre planning on
  hiring the help of a professional, its advisable
  to begin your search for a suitable accountant
  earlier rather than later, as if you wait until
  the tax season is in full swing, your options may
  be limited.

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• 2. Make your choice between cash or accrual If
  youre planning to prepare your own tax returns,
  then the cash method may be advantageous here as
  it is often more straightforward. The accrual
  method of accounting has its focus upon reporting
  earned income, and not just cash that your
  business has received, which some companies
  prefer as it matches expenses and revenues.

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• 3. Make sure you know which forms you need to
  complete The forms your small business will need
  to fill in are dependent upon the legal structure
  of your company. If you are the sole owner of
  your business, you can report your income or loss
  on schedule C of your own, personal tax return.
  LLCs, or Limited Liability Companies will require
  separate tax returns as they are usually formed
  to ensure that business assets are kept apart
  from personal assets. You will also need to look
  at state and local tax requirements in advance of
  preparing your tax return, to ensure that you
  have all of the necessary data ready in time for
  the deadline.

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• 4. Find out if you qualify for tax credits
  Whether your small business qualifies for tax
  credits, can change from year to year, and while
  basic tax credit information is sometimes built
  into tax preparation software, you might find it
  more beneficial to seek the help of a
  professional who can guide you through the many
  federal, state and local tax credit systems.

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• 5. Seek professional help No matter how well you
  think you know the tax system, or how well you
  think you can cope with planning and filing your
  own tax returns, there is nobody who understands
  the tax system better than a qualified accountant
  and their assistance can be invaluable in
  ensuring that you meet deadlines and dont make
  mistakes along the way. They dont come for free,
  but tax penalties can be costly, so hiring a
  professional could easily pay dividends for you
  and your small business.

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• 6. Purchase accounting software You may also
  wish to consider buying online accounting
  software, which can help you with many aspects of
  planning for the tax season, from tracking sales
  to generating financial statements and reports
  that a tax professional can refer to when
  preparing your returns.

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• At Heyer Associates, we proactively assist our
  individual and small business clients in meeting
  their goals. Our key area of focus is ensuring
  that our clients remain compliant with federal
  and state tax laws by providing them with high
  quality accounting and tax preparation service in
  Coral Gables. If you are looking for bookkeeping
  services in Miami, Heyer Associates would be a
  right option.