With only a countable number of days remaining to wrap up the year 2017, small businesses are getting everything needed to file tax of the ending year. As you approach January of the year 2018, ensure that you have all the documents pertaining transactions of your business for the year 2017.
But even before you reach out to your accountant, there are a number of tips that you need to familiarize yourself with. Stay tuned here to find the tips on what you should do or just understand as you approach January 2018.
Utilize payroll tax software to avoid costly IRS fines
Despite owning a small business, it is likely that you will still have a number of employees. Do not be tempted to handle your employees’ payroll on your own, however few they may be. Payroll tax errors are among the most highly fined tax offense and over one-third of companies are fined yearly for committing this offense.
You are more likely to generate incorrect payroll tax when you handle this on your own. Make a change this coming year and use a payroll tax software such as Gusto. This software will calculate, deposit and file payroll taxes automatically without any errors that may attract penalties.
Draw a boundary between business and personal finances
The fact that your business is a small one doesn’t mean you commingle funds belonging to the business with your personal funds. As a business owner, you need to have a separate bank account as well as credit card accounts for your business.
When you have these two handled separately, you will have an easier time managing the books of accounts in your business and ensure that your business undertakings and records are organized. Supposing IRS comes to take an audit of your business, you will be able to produce all documents to prove the legitimacy of the business.
Use accounting software
Make your tax time an easy time for you and your employee. You can achieve this when you incorporate an accounting software such as QuickBooks Online. With this program, all you need to do is to feed your business expenses and revenue and it generates a financial statement for your business instantly.
The software also helps you to keep track of your business revenue and expenses for all the year since you keep updating. Embrace this technology into your small business and make the filing of tax to be a work-over.
Be organized
Taxing times require adequate preparedness. This can only be achieved by a business that is very organized in all its undertakings. It only takes you as a proprietor to implement a few things in your business routine which include the following:
• Filing system- however much you may embrace technology in your business, you will not fail to have paperwork. Set a good filing system to keep all this paperwork in one place in an organized manner.
• Mark your calendar- you need a reminder to get that task done. If you don’t mark your calendar and book a date to complete that business task, you will definitely forget and it won’t be done. As a result of this, a whole twelve month-long-work will pile up
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