Small Businesses and Tax Time
When tax season rolls around, it can be a bit overwhelming to small business owners. With all the paperwork that needs to be done, it can surely be a daunting task. Add your regular busy schedule on top of it, and it may seem like you’ll never be able to do it. Never fear, small businesses can file for an extension that will give them up to six months to get everything together. Buying yourself some time and making sure that you have everything right will help you get the most from your business.
An extension gives you time to get your paperwork together. However, it doesn’t really give you extra time to pay. When you file an extension as a small business owner, you will be required to estimate what your taxes will be. You should start paying what you think you will owe right away. When the extension is over and you have filed, you can pay the remainder if you end up owing more than you thought you would.
If this is your first year, you definitely need to speak with a tax advisor. Figure out what all you can deduct. If you find out you can deduct something that you didn’t expect, then an extension will give you time to come up with receipts or bank statements telling you how much you spent on something that you can use when you actually file.
When you speak with your tax advisor, find out if changing the structure of your business could save you money. For example, if you are a sole proprietor, becoming an LLC (Limited Liability Company) or a corporation might bring your taxes down significantly enough to offset any cost that go into getting the title.
Be sure that you file on time. There are different rules for different types of corporations. However, all are required to file by April 15. You have to submit either an extension or your actual tax return by this date, or the penalties start to kick in. If you are sixty days late, then you will really get hit hard with penalties and interest.
Come up with ways to save your business money. A computer tax tracking system can be really helpful. Find ways to change your activities so that they are tax deductible. For example, your phone bill can be deducted if you use it for business. You may think that this only means your office phone or your cell phone if it is dedicated to the business. However, there are equations to figure out percentages of deducting your home phone or your personal cell phone if they are ever used for business. Even directory assistance calls can be deductible.
Simplify keeping track of your deductions by streamlining things that are making keeping track harder. Get a dedicated office cell phone so that you don’t have to figure percentages. Use mobile concierge services for phone directory assistance instead of making pricey individual calls. The cost is minimal and it is easy to figure out how much you spent at tax time.
About the Author: Joe Smith is a Marketing Associate of OnCall, a leading online source of mobile concierge services that goes above and beyond traditional directory assistance. Get international personalized assistance with phone direcory information, turn by turn directions, movie times, stock quotes, sports scores, and more at http://www.askoncall.com.
Tags: directory assistance, filing an extension, mobile concierge services, phone directory, small business deductions, small business tax extension, small business taxes