Hey there, Flagstaff business owners! Are you feeling overwhelmed by the prospect of tax season? We get it. Managing a small business is no easy feat, and finding the time to stay on top of your books can be a challenge. But fear not, because Nordstrom & Associates is here to help you navigate the ins and outs of small business tax prep.
As tax season approaches, it’s essential to stay prepared year-round to make filing easier when the time comes. That’s why we’ve put together a handy checklist of six essential steps every business owner should know to streamline their tax prep process.
1. Know Your Taxes Inside and Out
First things first, it’s crucial to understand the types of taxes your business is responsible for. Whether you’re a sole proprietorship, partnership, S corporation, or C corporation, you’ll likely need to pay income taxes, estimated taxes, self-employment taxes, employment taxes, and possibly excise taxes. Knowing which taxes apply to your business will help you stay compliant and avoid any surprises come tax time.
2. Get Familiar with Your Tax Forms
There’s no one-size-fits-all approach to tax forms. Depending on your business structure, you’ll need to fill out specific forms to report your profits, losses, deductions, and credits to the IRS.
Common forms include:
- Schedule C
- Schedule K-1
- 1099-MISC
- 1099-NEC
- Form 1120
- Form 1120-S
- Form 1065
- Form 720
Understanding which forms you need will ensure you’re properly documenting your finances.
3. Keep Track of Important Dates
Don’t let tax deadlines sneak up on you! Creating a tax filing calendar can help you stay organized and ensure you never miss a deadline. From sending out W-2s to filing your quarterly estimated taxes, knowing when important dates are approaching will help you avoid any last-minute scrambling.
4. Gather Your Documents
When it comes time to file your taxes, having all your documents in order is crucial. Make sure you have everything you need, including bank statements, receipts, invoices, and any other financial records related to your business. Being prepared will make the filing process much smoother.
5. Take Advantage of Deductions and Credits
Did you know that there are plenty of deductions and credits available to small business owners? From office supplies to business travel expenses, knowing what you can deduct can help lower your tax bill. Be sure to explore all your options and take advantage of any credits you may be eligible for.
6. Consider Filing an Extension
If you find yourself running short on time or facing a particularly complicated tax situation, don’t hesitate to request a filing extension. Form 7004 can grant you an additional six months to report your business income, giving you the extra time you need to ensure everything is in order.
At Nordstrom & Associates, we understand the unique challenges faced by small business owners. That’s why we’re here to offer expert guidance and support to help you navigate the tax prep process with ease. From tax planning to compliance, our team is dedicated to helping you achieve financial success.
So why stress over taxes when you can leave it to the professionals? Contact Nordstrom & Associates today to learn more about how we can help you simplify your small business tax prep and filing process. Let’s tackle tax season together!