Here are 4 common mistakes that entrepreneurs should avoid when filing their taxes.
Poor Record Keeping
It can be challenging to keep exact records when you also have to be focus on running your business. Accurate record keeping is essential to avoiding common tax mistakes. Maintain accurate records by establishing an organized system to record your income, expenses, and receipts. The IRS requires precise records or you could be loosing important deductions and money. In the event of an audit, every receipt and scrap of paper can make a big difference. If this is difficult for your small business Anderson, Peretti and Co. has the solution. Our bookkeeping team is poised and ready to take on the challenge of getting and keeping you organized.
Filing Late or Incorrectly
Avoid penalties and fines by filing on time and accurately. There are many deadlines and when a small business owner neglects to file on time the penalties can add up quickly. The IRS has a tax calendar to keep you in compliance. In addition to deadlines, the way your business is structured will also affect how much you end up paying in taxes. Make sure your business is structured correctly for the most benefit. A qualified tax professional can be a great resources for you to make sure you avoid both of these common mistakes.
Not Separating Personal from Business
Entrepreneurs commonly mix personal and business finances and this can be a real problem. Not only does it make things confusing but can be a red flag during a tax audit. Carefully separating your personal and business bank accounts and credit cards can be the first step to protecting your business. Keeping accurate records and a clear separation between the two will go a long way toward simplifying your tax preparation and keep you out of this pitfall.
Going it Alone
Running a small business can be a complicated, time consuming endeavor. There are so many things to remember and keep organized. Small businesses need to focus energy on the business, this is where a professional accountant can be beneficial. Working with a qualified professional means your tax return is done well, on time, and avoid common mistakes for the future. Not only will you get great advice on your taxes but you also have the opportunity to create a tax plan for the next year. Avoiding mistakes with a great plan will help you build wealth and hold on to it. You will also immediately benefit from having a tax professional at your fingertips when you need to interact with the IRS. Anderson, Peretti, and Co have a team of experienced tax professionals that can help you navigate difficult circumstances and create a plan to build wealth.
Anderson, Peretti, and Co is an accounting firm dedicated to high- quality service, with a personal touch, to businesses and individuals throughout Eastern Washington and Northern Idaho since 1969. Our team is equipped to assist you in all ares of your personal and business finance. Contact APC today.