Monday, April 15th is drawing near and many people this time of year find themselves pulling their hair or biting their nails. Don’t let tax season get you stressed. Following these simple strategies, utilizing available resources and being prepared can alleviate most of your tax anxieties.
Keep Good Records
- Proper record-keeping all year is the first step to ensuring your taxes are filed accurately. It is vital that you have the paperwork needed to back-up any of your deduction claims in the event you are audited (Keep tax documentation for a total of 7 years).
- Use an accounting program or software that can help you centralize and track everything so that your records are organized and expenses are easy to spot and deduct.
Doing Your Own Taxes
- If you are a sole proprietor, home-based business or a freelancer, then tax preparation software may be an option. You should note that not all software solutions offer business tax forms. Do some research to make sure the service has the forms you need before you sign up.
Understand Your Deductions
- In order to be deductible, a business expense must meet 2 criteria: 1) it must be both an ordinary and 2) necessary cost of carrying out your business.
- Keep business and personal expenses separate. That means maintaining separate checking accounts and credit cards for your business.
- Remember, deductions and tax credits change yearly. Most major tax software applications now ask questions that are meant to guide you through any changes.
- The Small Business Jobs Act of 2010 has over 17 tax provisions to decrease tax burdens for small businesses—several of these provisions can be taken advantage this year and can offer savings to your business.
- Remember the tax credits within the Affordable Care Act. These tax credits allow small businesses to cover up to 35 percent of employee health care premiums.
Explore Helpful Resources
- The IRS website is one of the best small business tax resources around. Their “Small Business and Self-Employed Tax Center” offers a wide variety of links, forms and useful articles.
- If you would rather watch a video, or attend a webinar presentation on business tax tips then try the IRS Video Portal.
- The “Filing and Paying Taxes” discussion board offered on the U.S. Small Business Administration “Community” tab is also a valuable option.
What are your tax time tips? How do you avoid the stress and anxiety so common at this time of year?
Information presented is not designed to be tax or legal advice and is subject to change at any time. The material and content on this site is not intended to be actual tax advice and has not been given or delivered as such. This site is meant to be used as an informative resource. It does not, in any manner, act as a tax professional or business accountant. You should seek out a tax professional for specific advice on your taxes.