It’s every business owner’s least favorite time of the year: tax season! We know this time can be stressful, especially if you’re new to owning a business. And even if you’ve been doing this for a number of years, it’s not always easy to remember the process since it’s only done once a year. So, we’ve put together a guide/refresher to help you through this year’s tax season!
Hiring a Good CPA
A good accountant will make sure you get the maximum number of deductions and credits, and they limit the possibility of an audit. Meeting with your accountant once a quarter can certainly reduce stress during tax season as well!
Deductions & Credits
Knowing what deductions and credits you qualify for is important. Common deductible expenses include employee payments, legal expenses, office equipment, retirement, and travel expenses. Make sure you keep those receipts as proof! Credits are quite different, but you still need to know if you’re eligible—hiring an unemployed veteran is a common way to receive a tax credit.
Employee & Contractor Forms
You are required to send out your employee’s W-2 no later than January 31st. All employees that were paid from January 1st to December 31st of the previous year will need to receive one of these forms. You’ll also need to send out 1099 forms to contractors that made at least $600 from working for your business.
Know the Deadline
The pandemic has caused tax deadlines to be extended in the past two years, but during a normal year, the federal tax deadline is on April 15th for corporations. If you need more time to figure out your eligibility for certain credits or deductions, file an extension. If you file an extension, you still need to make your payments at that time, thought it will only be an estimate.
After filing your taxes this spring, take note of where you needed help so that filing next year can be easier. Whether that’s hiring a CPA or finding a new way to keep track of business expenses, you’ll thank yourself the next year!
Growth Point Partnership focuses on improving systems, principles, technology, and processes for your business. Contact us today to get started!