The first quarter of the year is the time when business owners should start preparing for filing taxes. Filing taxes involves massive paperwork organized adequately so that it helps to create an accurate return without any chances of taking you by surprise later, explains Brian C Jensen.
Staying on top of the paperwork will give confidence to businesses of doing an excellent job in filing taxes and planning early will help to handle the high volume of documents generated during the initial months of the tax year. Whether the preparation is for filing the income tax return for the prior year or you can even be smart enough to plan for the current year, follow the tips given here to ensure that you do a good job.
Organized paperwork is a must, says Brian C Jensen
Filing the tax returns on their own might not be feasible for most business owners who find it more convenient to entrust the job to some professional companies. However, it provides only partial relief. Despite not working hands-on in filing taxes, the company must support the service provider with all data and documents to help compute taxes accurately. When preserving the documents, it is vital to understand the most important ones for filing taxes and ensure their quick retrieval when needed so that there is a perfect backup for every data mentioned in the tax filings.
Time for filing taxes
In 2019 IRS had announced January 27 as the opening day for accepting and processing federal tax returns. Confirms Brian C Jensen. The preparation should begin much early so that you can systematically organize things instead of making a last-minute dash. And creating more problems in maintaining data accuracy. Remember that it is more important to file accurate data. That you can substantiate well instead of doing any shoddy job just for the sake of meeting the deadline.
Be transparent to the tax preparer
Assuming that you hire the services of a professional company for filing taxes. You must be transparent to them in providing all relevant information required for preparing the return. Start by sharing your employer Identification Number (EIN) to establish your credibility, and it even becomes your tax ID.
Furnish all financial records to the tax preparer that shows your gross income. From sales or services, records of sales, returns, interest earned from a business bank account, and other income. It includes the cost of any inventory sold. The closing value of inventory needed materials and supplies, and items removed for personal use. Also, provide your business expenses to the tax preparer. To choose those that qualify for some deductions and credits, which can lower your tax liability.
To understand the tax credits and deductions that you can qualify for. Refer to the IRS websites that have a list according to the types of industries. To know how much you can save on taxes. Since tax laws keep changing, another method to save taxes is to remain abreast. With the latest tax laws to take advantage of any new credits and deductions allowed.
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