What Every Small Business Owner Should Be Aware Of
Author: Keith Huggett
Tax mistakes are every small business owner's biggest nightmare. Unfortunately, they're easy to make, especially for business owners who handle their own bookkeeping and accounting. The consequences can range from leaving money on the table, at best, to owing significant penalties or triggering an audit.
Becoming aware of the possible mistakes can help you avoid them:
- Personal deductions: Business expenses are deductible, but personal expenses are not. Mixing these two can result in more paperwork and red tape if you trigger an audit. Claiming excess deductions is a red flag for the IRS. Keeping your business expenses legitimate can help you avoid an audit and protect you in the event of one.
- Incorrect or missed payments and filing: Depending on your business, you may be required to file and pay payroll tax, sales tax, and estimated income tax. Some of these may require monthly or quarterly payments for which you can be penalized if they are late or underpaid.
- Updating tax tables: Tax laws change constantly, even in the middle of the year, and it can be too cumbersome for business owners to keep up with the changes.
One solution to all of these potential tax mistakes is outsourced accounting. A dedicated team of tax professionals stays up to date on tax legislation that may affect your business. Regular reporting also helps you manage cash flow so you have enough to cover your tax liability when the time comes. They can also help ensure that you don't claim expenses that you should not.
Outsourced accounting also frees up more time for you and your administrative staff to improve efficiency and focus on other business processes that will help your company grow. The Tax Office Inc. can help you navigate all these tax mistakes so you can keep more money in your pocket and avoid future penalties and fines. Contact us today to schedule a consultation.
