Calling all small business owners! When tax season rolls around, you must be ready. It pays off to file your taxes on time.
Several changes have taken place that may affect how you do your taxes. As a small business owner, you may not have to pay more taxes per the changes. Reports say 97% of small business owners will benefit from the changes.
To help you file your taxes, you need to read this article. It contains several top tax tips you must know about. Read on to learn about the small business tax tips.
Table of Contents
Keep Adequate Records
One of the best things you can do as a small business owner is to keep good records of your books. Make sure to keep your business records and receipts. This helps you keep track of your finances and know what taxes you’ll have to pay.
This can save you a lot of trouble when it comes time to calculate business expenses. You don’t want to rush at the last minute to have your finances in order. Failure to keep adequate records can leave deductions on the table.
Separate Business From Personal Accounts and Expenses
The IRS looks for small businesses that mix personal and business expenses. If your business is doing this, it can lead to an IRS audit. This is the last thing you want to deal with.
To avoid an audit, you must separate business and personal accounts. There must be no commingling. Don’t report personal expenses as business expenses.
If you seek to claim business tax deductions, you must make sure to follow the tax laws. These deductions include meals and travel expenses.
Classify Your Business Correctly
Did you know that the way your business is classified can result in overpaying taxes? Yes, it can. Determine what type of business you have.
Do you have a C Corporation or S Corporation? Do you have a limited liability company? It may be a good idea to consult with an attorney to find out how to classify your business.
Make Charitable Contributions
One of the top tax tips for business owners involves making charitable contributions. Making charitable contributions can cut your tax liability.
Consider donating cash or other assets. These contributions can entitle you to a deduction on your taxes. Don’t forget to get a receipt from the 501(c)(3) charitable organization.
Hire the Right Accountant
Getting tax season help is important. An accountant can help you with your taxes.
An accountant knows about the latest tax season tips to share with clients. The accountant you hire can help you with business tax planning throughout the year. Do you have a C Corporation or S Corporation? Do you have a limited liability company? It may be a good idea to consult with an attorney to find out how to classify your business.
These Are the Best Tax Tips for Small Business Owners
If you own a small business, you need to follow these tax tips. Following these tax tips can make a difference. It can help you avoid any tax issues.
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