While April 15 is the official IRS Tax Day, March 15th is actually when business taxes are due. Even though these dates might seem still far off, to make filing your business taxes this year easier, don’t put off your preparation. Even if you’re waiting for tax documents like 1099s from clients, there is still plenty you can do now to get ready to file your business taxes in a few weeks.
- Start a File Folder
If you’re a contractor and expect to receive 1099 or other tax forms from clients, they’ll start to trickle in this month. By law, you’re supposed to receive all 1099s by January 31, but it’s not uncommon for some of those to come in late.
Label a file folder “taxes” so you have an easy place to store these forms as they come in. You’ll add to this folder in the coming weeks, so keep it accessible.
- Print a Profit and Loss Statement from Last Year
Even if you’re a few weeks away from filing your taxes, you can still get a sense for how much income you’ll be taxed on, as well as how much you spent on tax-eligible expenses like payroll, office supplies, and business travel.
You should be able to create this report for 2014 from your accounting software. Once you print the statement, stick it in your tax folder.
- Send Your Own 1099s
If you work with freelancers or other contractors that you paid $600 or more to in 2014, you need to file the 1099 IRS form. The deadline to get this form to your contractors is January 31, while the IRS doesn’t need it until February 28.
If you’re scrambling to gather addresses and social security numbers for the people you need to create 1099s for, make it easier on yourself for next year and ask them to fill out a W-9 now so you have that information ready in 12 months.
- Start Thinking About Your Payment Plan
You likely will have to pay something for your small business taxes, so consider whether you’ve got enough money in savings to do so. If not, get a plan to set aside a healthy chunk between now and when you file your taxes.
If you can’t pay the full amount you owe in one payment, don’t sweat it. The IRS is willing to work out a payment plan with you.
- Meet with a Tax Professional
If you’re incorporated, your taxes are complicated. Find a tax expert who specializes in small business taxes. They will better know what you can use as tax deductions or an adjustment to income, and you might actually pay less than you think you might owe!
March will sneak up on you quickly if you let it, and don’t forget you also need to file personal taxes too, unless you are operating as a sole proprietor. If you do your prep slowly between now and then and you have all your necessary documents, tax time won’t be a major headache.
“Taxes Key Shows Tax Or Taxation” courtesy of Stuart Miles / www.freedigitalphotos.net