When starting a business, there’s no doubt it can be pretty intimidating at first. Between trying to manage every aspect of the workplace, as well as setting goals for your company, sometimes it’s difficult to get the basics down. For example, if you were to look at your list of what needs to be done, it’s easy to feel frustrated or overwhelmed. However, that’s why you need to take it one step at a time. For example, even before you start your business, how can you make sure you’re choosing the right candidates?
Look at their qualifications, and see who is a good fit. When it comes to handling your actual workload, always make sure everything is organized, so it’s easier to manage your business work. As important as these tips are when you’re starting a new business, what about taxes, and how should they be handled? That’s definitely something you can’t afford to overlook. As a new business owner, here are some of the basics you should know about handling taxes.
#1. Hire a Tax Professional
Many people successfully complete their taxes every year without any outside help. On the other hand, these people normally have a lot of experience. Since you’re starting a new business, however, it’s pretty much a necessity that you get help from a tax professional. Not only can they show you how the ins and outs of how business taxes work, but they can also show you how to manage your finances better, so that you won’t be struggling during tax time. After all, plenty of business owners wait until the last day before they start preparing. By gathering and calculating your finances throughout the year, however, you’ll be well prepared for what’s ahead. Remember, a tax professional does more than just show you how to complete your taxes. More importantly, they show you how to prepare as well. Overall, be sure to keep this in mind.
#2. Keep Track of Your Expenses
Like I mentioned earlier, it’s essential you’re recording and gathering all expenses you’ve made over the year. After all, that’s what you need to report on your tax return. Many times, however, people unintentionally neglect these expenses. Sometimes it’s easy to forget what transactions you’ve made, especially the minor ones. Failure to report these, however, could result in penalties from the IRS. When paying for items, especially for the business itself, always make sure to keep receipts of your transactions. That way, you know exactly what to report come tax time.
#3. Check For Estimated Tax Payments
Depending on your business profit, you might have to make estimated tax payments throughout the year. You will have to make four estimated tax payments throughout the year, which includes April 18, June 15, September 15, and January 17. Not every company has to pay these taxes, but some businesses do. With that said, make sure not to miss any of these payments if they’re required. Usually, businesses who miss these payments have to pay a penalty for underpayment of estimated tax.
Overall, these are some important tips for handling taxes when starting a new business. First off, you can’t handle it own your own, which is why you need a tax professional. Second, keeping track of your own expenses is important. Always make sure you’re reporting every transaction you’ve made over the year. Lastly, check to see if all you need to do is file, or if you’ll have to make estimated tax payments over the year.
For more information about what you need to know about taxes when you have a new business, feel free to contact us today at GMLCPA. A CPA with a sense of humor who loves to provide customers with valuable advice, I look forward to hearing from you, and assisting you in the best way possible.
