If your business is going to be successful, you need to get your tax in order. The last thing you want is al letter from the IRS saying that you owe them money. The amount could range from an insignificant number to one that will cripple your firm. Your best option is to keep on top of your tax so that it doesn’t become a problem in the future. Here’s how to avoid the biggest and most threatening issues with regards to tax.
#1: File Annually
First of all, you need to file an annual tax return. If you don’t, the IRS will think that you are trying to dodge your taxes. Dodging taxes is illegal, and you could be fined or sent to jail. The basics are simple. All you have to do is work out how much your business made last year and how much you owe in tax. As long as there are no glaring mistakes, the government isn’t too strict. If there is a problem, they will contact you for more information.
#2: Report All Of your Income
The government may not deduct tax from certain incomes, but that doesn’t mean they don’t want to know about it. They want to know about everything you earned in the tax year for transparency. If they can see your income, they can judge whether you are paying the right amount of tax. As such, don’t withhold your income from them even if you don’t think it is needed. Your best bet is to be as transparent as possible. That way, you don’t have any skeletons that can come out of the closet.
#3: Pay What You Owe
As long as you pay what you owe, there won’t be any problems. In fact, the IRS will leave you alone and only bother year at the end of the tax year. The problems occur when you don’t pay what you owe them, or you knowingly try to avoid paying tax. Have faith that you don’t want the government on your back for the foreseeable future. They can make your life hell.
#4: Ask For Help
If you can’t pay what you owe, don’t suffer in silence. David Yarborough is the CEO of Yarborough Professional IRS Debt Solutions, and his firm have a range of options to help. All you need to do is contact them and inform them of your situation. They will tell you whether they can help or not, and you can take it from there. If they can’t help, shop around for someone that can.
#5: Get An Accountant
To avoid all of this, you should hire a professional. The odds are that you are not an expert in everything tax related. And, that isn’t a problem. After all, no one expects you to be an expert in every field. What they do expect you to do is pass it on to someone that does have expertise. Then, they can keep your books neat and tidy and pay everything you owe on time. An accountant is worth their weight in gold for any business.
Follow these tips and you will never get in trouble with the taxman.