Owning and operating a small business is exciting, but with so many moving parts, it’s good rule of thumb to plan ahead. This includes your business’ finances. These helpful tips for being proactive about your business’ tax planning will save you time and money in the long run.
The sooner you get organized, the better.
This entails understanding the basics of the federal and state tax laws applied to businesses. Be prepared for and aware of what and when specific taxes are due. Know what you can deduct and what you should track.
Create a calendar.
Use a calendar to highlight all those important tax dates and deadlines. For example, a tax calculator lets you input each date payroll deposits are due. You can include filing deadlines for W2s and 1099s as well.
Make a payment plan.
Consider making quarterly payments rather than a large yearly lump sum. However, you may need to pay estimated tax payments to avoid penalties at the end of the year.
Maintain good records!
This is a one of the best tips for being proactive about your business’ tax planning. Save all receipts that relate to business expenses throughout the year. Keep track of all income statements and balance sheets too.
Deduct your home office.
Now more than ever, we are working from home. Did you know you can calculate the square footage of your home-work space and deduct a portion of the expenses? This includes expenses like utilities, computer equipment and mortgage interest payments, for example.
Deduct car expenses.
Again, this circles back to keeping meticulous records. It also involves a little calculation like the home office. Figure out what percentage of car use is business and deduct it from your overall car expenses.
Start a retirement fund.
There are certain IRA accounts and retirement plan contributions that are tax deductible. Best way to know? Work with a tax expert.
Consider charitable contributions.
Being socially responsible pays off. Besides adding meaning to your company’s core values, getting employees involved in giving back is smart business. In the end, you will qualify for specific tax breaks.
Hire a professional!
We saved the best out of our tips for being proactive about your business’ tax planning for last! Business owners are responsible for filing and paying taxes properly. Rather than stress and possibly miss something, let the professionals (us) handle your tax planning all year long!
Greene & Vaughan are the professionals your small business needs. From knowing the current tax laws to creating a tailored tax plan for your business, we start by meeting with you. We continue to meet with you throughout the year and together manage your business’ financials.
For more helpful tax tips, advice and general information about our services, continue to read our blogs!