Are your small business taxes filed? Now that you’re breathing a sigh of relief it’s all over, it’s time to start thinking about next year’s taxes. Yes, that’s right. Now is the perfect time to start tax planning. Here are 3 steps that will make filing your 2013 taxes easier.
1. Get professional help. You may be able to file your business taxes yourself, and if it’s honestly easy for you (say, you’re an accountant yourself, you love crunching numbers or your business is a sole proprietorship with very simple income and expenses), that’s great. But for most of us, preparing our own taxes leads us into a morass of confusion and piles of papers that takes more time than it’s worth.
Small business owners are notoriously bad at delegating, but taxes are one area when delegating to the pros makes sense. Accountants spend their lives keeping up with arcane tax laws, so they know what deductions you can and can’t take and how to maximize your savings and minimize your expenses. If you don’t already have one, find a good accountant who specializes in small businesses and/or your industry—you’ll probably save the cost of him or her several times over.
2. Keep good records. Your accountant can recommend a bookkeeping system that works for you, whether that’s QuickBooks or something else. It’s important to maintain good records, including expense receipts (you can scan these into your computer and store them digitally to save space) and records of automotive expenses and mileage, travel and entertainment and anything else that you plan to deduct as a business expense. You should also keep copies of your income tax returns, records of equipment purchases and records relating to your employees’ wages and taxes paid. Your accountant can advise you what specific records you need to keep and how long to save them.
3. Learn from your mistakes. What do you wish you’d done differently this year? Did you fail to make some basic moves that could have saved you money? Whatever you wish you had done last year, plan now to do it this year.
Of course, the mentors at SCORE can help plan ahead for next year. If you don’t have a mentor, visit SCORE’s website to get matched with one today.