5 Things Every Small Business Owner Should Do Regarding Taxes and Accounting Part 2
In our last blog, we went over the first part of 5 things every small business owner should do regarding their taxes and accounting. If you have not read that blog, please check it out here. But without further ado, here are your next three focus points as a small business owner.
Tax & Accounting Tip #3: Get a Grip on your taxes
If you don’t have a grasp on your bookkeeping, it will be much harder to ever get a grip on your taxes, especially your income taxes. Each of our points has led themselves into each other and so if you do not have a good handle on your bookkeeping, getting a grip on your taxes will be more difficult. You can always get help from places like Prospect Financial Solutions where we can offer you a free tax consultation to help you start this process of getting a grip. Also, a tax professional will help you so that you can take advantage of crucial tax laws like Trump’s Qualified Business Tax Deduction which is a new and excellent business building tax deduction.
Tax & Accounting Tip #4: Reviewing your business Structure
If you are operating as a sole proprietor, you should be looking into becoming an S Corporation or an LLC. You cannot continue to stay as a sole proprietor and make sound business choices with your taxes. If you are a sole proprietor, then you are paying all of your self-employment tax. If you are an S Corp, then you will not be paying these taxes on your profit. There are other compliance issues that you will have to deal with, but your income benefits will go up dramatically.
Tax & Accounting Tip #5: Stay Compliant
Being compliant in California can be the life or death of your business. We always recommend using a trusted professional for filing your sales tax, payroll, and bookkeeping. A tax professional will file any extension or additional paperwork that you need so that you can be tax compliant. They will keep you from paying fines, help you if you ever should be audited and help ensure that you are receiving any tax breaks that you can.
We hope that these five tips will help you in the way that you handle and address your tax and accounting needs. If you have further questions, please feel free to contact us. We would love an opportunity to look at your specific case and see where we can help.