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Hello, Community! Are you an entrepreneur just starting out? Have you found yourself wondering what you'll need to do to get ready to file taxes for the first time as a business owner? If so, look no further. Here are few points of tax prep to get your started in the right direction.
Basics
You'll need to start with the basics. This information includes your business structure; whether it be a sole proprietorship, corporation, single-member LLC, etc. Additionally, you'll need to know your business tax ID number (EIN). It's also not a bad idea to have a list of assets and equipment.
Get Organized
When tax time rolls around you'll want to be sure all of your related documents are in one place, such as any 1099 forms. That way you're not scrambling around looking for this or that. One way to do this is to create a folder specific for taxes, and then a sub-folder for receipts. Another, even more effective option would be to use QuickBooks! Each business expense and income is saved and then further categorized for your convenience.
Deductions
Everybody's favorite word when it comes to filing taxes! Some business deductions include startup costs, trademarks, training material, office space, etc. Write down a list of what you think would fall under this category and your accountant will let you know for sure.
Final Prep
Before you head to your accountant's office, you'll want to be sure you've reconciled your accounts. This is an accounting term used for "balancing the check book." Grab your bank statement and make sure each transaction is accounted for. That way your CPA doesn't have to call you multiple times asking where this expense or that credit came from. Each transaction will already be checked off with no need to second guess. Lastly, it's always a good idea to check your Profit & Loss report to make sure everything is accurate.
These are just a few simple tasks to keep up with to make tax time a little easier on you. I'm sure your accountant will be glad to help, and of course you're always welcome to ask questions here in the Community as well. There are so many knowledgeable members that would be happy to lend a hand. Take care everyone!
