There’s no way around it—taking the time to complete business income taxes is no fun. But filing taxes on time (and correctly) is an important part of running a successful business. Ensuring that you are accurate and timely will also help you avoid fees or other more serious repercussions. But what if you have questions about how to file your taxes correctly? What if you don’t even know where to begin? What if you need help navigating any repercussions the IRS has already taken against you? This is where professional tax consultants come in. Below are a few of the main reasons it makes sense to hire these professionals to help you file business income tax.
1. They Help Determine How Much You Owe
All businesses are required by the IRS to pay taxes on the profit or income they earn throughout the year, and the amount owed in taxes is determined by the amount of money earned. But what counts as “profit”? According to the IRS, a business should consider gross business sales, then subtract the costs of goods sold to determine the total profit. All profit should be reported on business income taxes. Tax professionals will guide you through this process to make sure you don’t miss anything. They will also help determine whether you are eligible for any deductions, meal expenses, travel costs and/or gifts given for business purposes.
2. They Adjust Taxes Based on Business Structure
The amount you owe in taxes also depends on the type of business you own. There are various types of business structures, including sole proprietorships, partnerships, corporations and S corporations. Tax professionals will help you identify your business structure and pay the correct taxes accordingly.
3. They Help Budget and Plan Ahead
If you run a business yourself, you need to remember to put aside some income for tax payments as you earn. Unlike employees, who can count on an employer to withhold taxes on their behalf, business owners are required to make estimated tax deductions for medicare, social security, and income taxes. This will help ensure that you don’t run into trouble when it comes time to pay taxes—the amounts should already be set aside. Tax professionals can help you go through your income and let you know what you need to plan to set aside.
4. They Help Navigate Repercussions
In the event that you do run into trouble, tax professionals can help to mitigate the damage or file an amended tax return to preempt a potential issue down the road. If a business fails to pay all required taxes, the IRS can take more drastic actions to recover the amount owed, including filing a notice of federal lien, filing a notice of levy, and/or seizing business assets or property. If this occurs, it is imperative that the situation is handled appropriately. If the business tax deficit is not paid, the IRS can turn to individuals to collect the funds, including business owners or shareholders. Having a tax professional by your side to help repair the damage (and allay your fears throughout the process) will make all the difference for your long-term success in business.
Dealing With Business Income Taxes
Dealing with business income taxes is no walk in the park, but with a tax professional on your side, it can be so much less stressful. You can count on them to determine what you owe, where you can save, how to budget, and how to navigate any repercussions you may be facing. Get in touch with one today and take the load off your back.