Own a small business? Trying to brainstorm to make sure you remember all the details you need to pull together at year end for tax season? Here are a handful of useful tips to keep in mind over the next few weeks and months.
- Document Donations – Make sure you keep a record of all donations made to qualified charitable organizations. Contact each organization and request a letter be sent to you by the end of the year, or by January 31 at the latest. While helpful but not required on smaller donations, the IRS does require a letter for each donation over $250, so make sure your records are accurate.
- Gather Statements – Gather all 12 months of any bank or credit card statements and organize them. Make sure you don’t miss any accounts, including online accounts with statements that need to be downloaded.
- Estimated Taxes Paid – Figure out all of the estimated taxes you have paid to federal and state agencies. This information will be required when handing over your financial documents to your tax preparer this spring.
- Form 1095 – Keep an eye out for Form 1095 A, B, or C. This form offers proof that you had adequate health coverage throughout the year.
- Understand Tax Extensions – If you are one of the many businesses that request a tax filing extension, be aware that the extension only applies to the filing, not the payment. You are required to make a minimum payment by the due date even if your return is filed late; otherwise, you may face stiff penalties.
There are plenty of things that are important to consider when running a business, and taxes are definitely one of them. Make sure you are aware of these basic facts, and work with a reputable tax accountant to make this process simpler come tax time.