Small business taxes are required to be filed every year. It is possible to hire a small business accountant or small business CPA in Sandy to assist with filing, but you can also do it yourself. Whatever way you choose to file taxes for your business, there are important steps that must be taken.
1. Have All Your Records and Documentation in Order
Make sure you have all documentation and records that cover any expenses and profits. You need every record in this to make your taxes as accurate and smooth as possible when filing your taxes in Sandy.
A great way to get your records ready to go every year is to use a spreadsheet or data application on a computer. This will put everything in one place rather than forcing you to dig through multiple records to find what you are looking for. Some tax software programs even incorporate the data directly from the financial applications.
2. Select the Form that is Best for Your Small Business
It is important to use the correct IRS form for your small business to keep accuracy a top priority when filing taxes. The forms are used to report the profits and earnings that are made throughout the years.
If you are a sole proprietorship business, you should utilize a Schedule C attachment. The same is true if the business is a LLC with one owner. If you are a corporation utilize Form 1120. Filing your business taxes online will often pre-select the correct form for you based on the questions you answer correctly.
3. Fill Out the Form Correctly
The schedule C form used for sole proprietorships and LLCs with sole owners can be found on the IRS’ website or can be filled out automatically through an online tax service. This form is relatively simple at its two page length. You simply perform subtraction of the expenses from profits. That number than goes on the personal income form.
Form 1120 for corporations is a bit more complicated. You still subtract as you do on the schedule C, but you provide more details to provide personal information. This is due to the form being filed separately from the personal income forms.
4. Be Sure to Submit All Documentation by the Deadlines
Schedule C, as it is just an attachment, has the same deadline as personal income taxes which is April 15. Form 1120 when you are a C-Corp most of the time applies to April 15, as you file on the fifteenth day of the fourth month after the previous tax year. Form 1120S, used for S-Corporations, should be filed on the fifteenth day of the third month which is most of the time March 15.
Working with a Utah CPA
Small business taxes and tax filing can be a confusing process. It requires accuracies in the forms, the filling out of the forms and the deadlines of the forms that can only be found by having your documentations in place and ready. Hire a small business accountant or a small business CPA to assist you in filing your taxes this year.