3 Things to Do Before Tax Season Opens
January 19 is the first day of tax season, so make sure your tax stand is ready and you only bag as many taxes as your hunting license allows. We kid. Actually, the Tuesday after next is the first day the IRS will begin accepting tax returns, and will continue until Monday, April 18th.
Two weeks is enough time to get everything in order, right? It is, and here's what you need to do:
1. Get Your Docs in a Row
Depending on your year, tracking your tax paper trail can be a challenge. Job changes, large purchases, and business reorganizations can all complicate your tax filing, not to mention the documentation you'll need to justify your deductions. So the first step is making sure you have all the necessary paperwork from your 1099 to your employees' W-2s.
Hopefully you've been organized enough all year to make this process easy and you've been keeping your tax records from previous years. If not, focus on the big things first and work your way down to your expense receipts.
2. Dock Your Deductions
From employer-provided childcare credits to deductions for working from home so you can watch your own children, you've got to know which business tax credits and taxpayer deductions you can take advantage of. You can probably figure out most of these with a little research on the IRS website, but it never hurts to call in a professional to help you hunt down the lowest tax payment and biggest return.
3. Go to Class
One of the biggest small business stories of the past few years has been the battle between employees and independent contractors. The IRS doesn't take kindly to misclassifying workers, and the penalties for misclassifying employees as independent contractors can be severe. So make sure you're familiar with the factors used to distinguish contractors from employees, and that your small business is complying with the law.
One last word of advice: the tax code is complex and the last thing you want is an audit, so you might want to consult with an experience tax attorney before you file this year. They might help you put a bigger tax trophy on the wall.
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Related Resources:
- Browse Tax Lawyers by Location (FindLaw Directory)
- 3 Overlooked Small Business Tax Deductions (FindLaw's Free Enterprise)
- 5 Things a Tax Lawyer Can Do (That You Probably Can't) (FindLaw's Free Enterprise)
- IRS Hacked: 100K Tax Accounts Accessed by Data Thieves (FindLaw Blotter)