Like it or not, every small business has to pay taxes and there won’t be much sympathy for a business that doesn’t file properly.
Let’s take a look at some of the most important things to keep in mind during tax time.
Without a doubt, the most important things you want to remember when it comes to paying your corporate taxes are the various deadlines that are imposed by the IRS.
Tax payment interest is hardly equitable; you will find that if you are owed some kind of return, you won’t see a lot of interest coming your way.
On the other hand, if you miss that deadline and make an overdue payment, you can expect to have a daily interest rate leveled against you that can make your head spin!
The good thing about owning a business for which you have to file corporate taxes is that most of the time, your records will be ready to file right away. It’s not like employment, where one has to wait for an employer to get the proper forms out so you can do your filing.
It’s good to start on your small business taxes right away – as soon as January rolls around – so you can get them out of the way.
There are several deadlines you need to be concerned about, depending on how you file your corporate taxes. If you use the services of an accountant, you need to take note of his or her deadline for your submission.
Remember, it is a busy time of year for them and you don’t want your taxes caught in the bottleneck. If you are doing those taxes yourself, make a note of the due date so you can file on time.
If you pay employees, you also need to remember the deadline for sending out those W-2 forms.
For most small businesses this has to be done by February, and you can get into a lot of trouble if you are late as it affects not just your business tax filing but the personal income tax of the employee.
We all live in fear of the audit, but the fact is that the process is not so bad if you can be confident in your record keeping. Laws require that all information pertinent to corporate taxes be kept for at least ten years.
That means that you should keep your income sheets for each year in a safe spot should the IRS come knocking. It also means keeping an accurate record of your deductions, including all the receipts that prove you made those deductions.
Lost records of transactions when it comes to deductions can really kill a small business in an audit down the road, when that ugly interest will raise its head.
The most important thing to remember when it comes to paying corporate taxes is to stay organized.
You shouldn’t just fly into panic mode at tax time; instead, keep your records up to date all year long. That way, tax time is less stressful and will go much more smoothly.