Hey biz owner, we know you are busy serving clients, managing your growing team, trying to stay on top of the admin side of your business AND trying to be a great partner, friend and maybe even a parent at home! No wonder taxes keep sneaking up on you – you have a lot on your plate.
If you already work with Empowered Profit – (Insert sigh of relief) – we’ve got you. Read through the below tips and also know that you will receive your tax organizer in January with the details of everything you need to gather together, and questions you can answer so we have the information we need to provide you with great tax support.
If you already know you need support with your taxes and want to talk to our team…
1. Make a list of documents that you usually receive for your taxes and make a plan for where you will store them when you receive them.
You can review last year’s tax return to see what documents you normally receive. Also think about any changes that happened in the past year…Did you open any new savings accounts? Make any investments? Receive an inheritance or collect unemployment?
If your tax documents come to you via email or digitally, will you download and keep them on your desktop? Perhaps you want to set up an email filter or folder in your email to collect everything.
If you receive them via snail mail will you scan them right away and keep them digitally or have a paper file folder on your desk?
However you want to handle this is fine, but come up with your own system NOW and do your best to stick with it. It will make things SO much easier when it comes to handing over to your tax team.
The more complete the package is that you provide to your tax team, the easier & faster it will be for them to get your returns completed, submitted and you can check taxes off of your list!
2. Mark your calendar with important upcoming tax dates!
Here is a list of general dates that apply to most business owners (keep in mind all dates may not apply to you or your business). The dates vary year to year so make sure to check the IRS website, but this way you know about when the main deadlines are. If you’re unsure which apply to you, ask your tax team and then add them to your calendar or project management software NOW.
If you work with Empowered Profit, we also have internal deadlines of when things need to be submitted to us so watch for those emails as well.
🗓 January 15th – 4th quarter (previous year) estimated tax payment due.
👉 Don’t forget about issuing 1099s this month as well, those are due to the IRS and contractor by January 31st.
👉 If you have employees, the deadline for issuing W-2s to the IRS and your employees is January 31st. (Your payroll company likely takes care of this, but you will want to review them to be sure they are correct and download copies for your permanent records)
🗓 March 15th – S-Corporation and Partnership tax return filing deadline.
👉 This month is also the deadline to file for an extension for your S-Corporation or Partnership Tax Return for the previous Tax Year. Remember, this is an extension on the filing, NOT the payment due. There’s no federal tax due with an S-Corp or Partnership return, but your state may have a payment due.
🗓 April 15th – If you have a C-Corporation & make payments quarterly, the 1st quarter (current year) estimated tax payment is due.
🗓 April 15th – Individual tax returns due (for previous tax year). If you are a Sole Proprietorship or LLC (that hasn’t elected S-Corp yet) then your business return is filed along with your personal return as part of this deadline.
👉 The due date for filing tax returns and making tax payments is typically April 15th but it may shift slightly year to year. If you haven’t applied for an extension, e-file or postmark your individual tax returns by midnight.
👉 The Individual Tax Return Extension Form is also due on this day. Remember, this is an extension on the filing, NOT the payment due.
👉 This is also the last day to make a previous year IRA contribution.
🗓 June 15th – 2nd-quarter (current year) estimated tax payment due.
🗓 September 15th – 3rd-quarter (current year) estimated tax payment due.
If you are an S-Corp and got a filing extension on your S-Corp tax return, you need to complete it and e-file or have it postmarked by September 15th.
🗓 October 15th– Extended individual tax returns due
If you got a filing extension on your tax return, you need to complete it and e-file or have it postmarked by October 15th.
Remember: This list is a great starting point, but depending on your individual tax circumstances and the structure of your business, there may be other deadlines you should be aware of or all of these may not be applicable to your business. Make sure to talk with your tax team to be sure you are clear on your individual due dates.
Did you miss a deadline? Don’t worry, there are options for you & it can all be worked out. Don’t beat yourself up for missing something and keep avoiding it. Accept that it happened and move forward by getting the tax support you need.
3. Review anyone you’ve paid that may need a 1099 issued.
Not sure if you need to issue a 1099? Here is a detailed article that will help.
Once you’re clear who needs one, start your list and make sure you have all the information from them that you need.
Remember, these are due to the recipients and the IRS by January 31st, so start this now.
4. Set some time aside to go through the records from your accounting team. If you’re working with Empowered Profit, we take care of this through the year but it never hurts to do a final review before tax season so you have time to make adjustments if needed. Was there anything missed, something you forgot to mention to your accounting team, or questions you have about certain purchases being tax deductible? Don’t wait until you are reviewing your return to ask questions if you have things you are unsure about.
5. Make sure any personal charges (that are actually business related) are captured.
You’ve heard us on our soapbox a million times about separating your business and personal account. But we know that sometimes as a small business owner, you make business purchases with your personal money. Go back through and make sure it’s captured so that you can use it as a business deduction. If you purchased something on your personal credit card or with your debit card, your accounting team won’t know about it unless you tell them – and if you don’t tell them you will not get that tax deduction!
Again, don’t wait until you are reviewing your tax return because at that point, it’s going to be too late!
Taxes don’t have to be hard, scary or something you avoid at all costs. Our hope is that if you stay on top of tasks throughout the year, mark deadlines on your calendar and set some time to get organized at the end of the year. Then you’ll be wondering why you wasted so much ink moving it again and again to the bottom of your never ending to-do lists.
Are you receiving a deduction for your home office space? We go through this with our Empowered Profit clients but sometimes your bookkeeper doesn’t realize you can file for this with a virtual or home office. Talk with your tax team about this, and start gathering the expenses you will be able to use for your deductions. This could include things like rent or mortgage interest, utilities, home maintenance and repairs to your home office during the year. This is a great tax reduction strategy so make sure you are taking advantage of it if you are eligible.
Purging at the end of the year to start fresh? Make sure you know what you can toss and what you need to keep. Read more about it here in our Blog Post, Keeping and Purging Financial Records.
This is provided as information only and as a starting point for a conversation with your own legal and accounting team, this should not be considered legal or financial advice.
All of these decisions are based on a number of factors and we cannot guarantee that you will experience any specific results based on any information provided. Please speak with your own retained professionals to ensure that you are making the best decisions for your business & personal situation.
Please speak with your own retained professionals to ensure that you are making the best decisions for your business & personal situation.