Taxes are the bane of everyone’s existence. Not only do individuals want to keep more of their hard-earned money, so do businesses. The trouble is, making a mistake can spell disaster, especially for large companies.
Don’t let Uncle Sam be the reason why you struggle to stay in business when tax time rolls around. With these tips, you can keep more of your hard-earned money while keeping the IRS at bay.
An Organized Invoicing System
Everything revolves around how much money your business makes, and that includes what kinds of taxes you’ll be responsible for paying, as well as what deductions you qualify for. That means keeping track of your invoices is extremely important.
The right invoice processing software makes dealing with incoming and outgoing invoices a breeze, but it also keeps track of every penny that comes into and goes out of your business. When tax time rolls around, you can be certain you know exactly how much every area of your business made.
An Organized Receipts System
It doesn’t matter if your business is big or small, or if you’re simply filing personal taxes, everyone wants to know what business expenses they can deduct.
There’s a long list of possibilities that include:
- Vehicle expenses
- Supplies
- Depreciation
- Utilities
- Repairs
- Travel
- Meals and entertainment
- And much more
However, you can’t expect the IRS just to take your word for it. You have to have proof that you spend money on those things, and exactly how much, which means your business needs an organized receipt system.
Electronic systems are the best. You can scan receipts and file them away electronically without the need to hang on to paper receipts.
It’s even better if you keep track of your deductions as they come up. That way, things are easier when tax time rolls around. You won’t end up leaving an important deduction behind because you forgot about a purchase that was made earlier in the year.
Increase Compliance Throughout the Year
Compliance means lots of different things. It could mean ensuring employees are compliant with company policies, it could mean making sure your IT strategy is compliant with the latest security demands, but it also means making sure you’re compliant with relevant laws, policies, and regulations.
Regular compliance checks throughout the year can make sure your finances are in order, and it can make sure that you’re complying with all of the rules and regulations set forth by the IRS for businesses. That way, you don’t end up paying a fee simply because you didn’t realize it was a possibility.
It’s Better to Overpay Than Underpay
It’s not just people who don’t pay their taxes who get penalized by the IRS. You can get penalized for not paying enough taxes, and those penalties can be high for large businesses with high incomes.
Not only are there flat fees for not paying as much as you should have, but you can also expect to pay a percentage of your income in interest. Although it’s frustrating to pay more than you should and wait to get refunded the money later, it’s better to overpay and receive a check in the mail than it is to send them more money when it’s time to file taxes.
Hire a Professional to Help All Year Long
Dealing with taxes is hard work because it’s so confusing. All the confusion of trying to get everything right can cause you to lose sleep at night.
An accountant can be extremely helpful to your business. They can help you keep track of the other items on this list all year long, and if you hire a CPA, you can get year-round tax advice too.
A CPA is a trained professional that knows what kinds of deductions you should be taking, but when you hire one to work with your business all year long, they can provide you with suggestions you may not have thought of to save even more money throughout the year.
In addition, they can be responsible for keeping relevant information organized all year long. That way, when tax time comes, you aren’t up all night digging through files, trying to get everything ready to go.
Don’t let Uncle Sam take more money than he’s owed! It may take a little time, patience, and attention, but with the tips on this list, you can save money all year long without paying for it when the taxman comes to town.
