It’s Tax Season, Be Prepared: A Checklist for Small Business Owners

Tax season is not a fun time for anyone, especially for small business owners. However, with the right preparation, you can make the process smoother and reduce the chances of making costly mistakes. Here's an easy checklist to help guide you and get you prepared:

Organize Your Records: Gather all your financial documents, such as bank statements, credit card statements, and receipts, and organize them by month. This will make it easier to track your income and expenses and ensure that you don't miss any deductions.

Review Your Bookkeeping: Review your bookkeeping to ensure that your records are accurate and up-to-date. Make any necessary adjustments or corrections and reconcile your accounts to ensure that your financial statements match your bank statements.

Determine Your Filing Deadline: Depending on the structure of your business, your filing deadline may vary. For example, sole proprietors and single-member LLCs generally file their taxes on April 15th, while partnerships and S corporations have a deadline of March 15th. Make sure you know your filing deadline to avoid penalties.

Choose Your Method of Filing: Decide whether you will file your taxes yourself using tax software or hire a professional accountant to prepare your taxes. Keep in mind that hiring a professional can help ensure accuracy and may save you money in the long run.

Gather Employee Information: If you have employees, gather their W-2 and 1099 forms and ensure that their payroll records are up-to-date. This will help ensure that you are in compliance with employment tax regulations.

Review Your Deductions: Review the deductions available to you and ensure that you are taking advantage of all the deductions you are eligible for. This can include expenses such as home office deductions, business vehicle expenses, and depreciation.

Make Estimated Tax Payments: If you expect to owe taxes, make estimated tax payments throughout the year to avoid penalties and interest charges.

Check for Changes to Tax Laws: Keep up-to-date with any changes to tax laws and regulations that may affect your business. For example, the Tax Cuts and Jobs Act of 2017 made significant changes to the tax code that may impact your tax liability.

Consult with a Professional: Consider consulting with a professional bookkeeper or accountant to ensure that you are taking advantage of all available deductions and are in compliance with all tax regulations.

By following this checklist, you can ensure that you are prepared and minimize the stress and headaches that often come with filing taxes as a small business owner. Remember, preparation is key to making the tax season process as smooth as possible. Let us help you make sure everything is in order by scheduling a free consultation today!