Tax preparation can be stressful for business owners. Gathering the required documents and information and communicating with your tax preparer can alleviate some of the stress. Here are some things to know while preparing for tax season:
Tax Cuts and Jobs Act (TCJA): The 2019 filing season is the first under the TCJA. The TCJA, enacted in December 2017, went into effect in 2018. There are significant changes in tax law that can effect businesses – small and large. Talk to your accountant and tax preparer about how the changes affect your business.
Resources available from the Internal Revenue Service:
Communicate with your tax preparer and request or download a checklist of documents you need. Here is a partial list:
- Accounting records
- Bank statements
- Credit card statements
- Payroll reports
- Updated assets list (assets purchased and sold)
- Depreciation schedule
- Last year’s tax returns
- Don’t procrastinate. Need to consult with your bookkeeper, accountant or tax preparer? Plan ahead and schedule your appointment early.
- Confirm all your business records are up-to-date. Be sure all income and expenses are entered into your accounting system or are ready for your bookkeeper.
- Request a year-end summary from your credit card providers. This is a great way to get a break down of expenditures by category for card purchases.
- Know you filing deadlines. Be aware of all tax filing deadlines and don’t forget other tax filings or regulatory requirements that may be necessary for your business. In addition to Federal taxes, confirm if you need to file:
- State and local taxes
- Federal and state employment tax
- Annual report, licenses, permits
Lastly, do you want to reduce future tax preparation stress? Create your own timeline and checklist to guide you throughout the year. Keeping updated records through the year will save time and reduce stress. Have a plan and use it!