For small businesses, filing taxes can be expensive. In addition to having to pay taxes, the cost of running the accounting and bookkeeping process is pricey—almost half of all small businesses pay over $5,000 per year in legal fees and internal costs.
What’s worse, it’s time consuming, and small businesses have to think about year-round. Payroll tax, for example, is an issue when hiring a new employee—something that can happen at any time of year, not just tax season.
Luckily there are more free tax resources than ever. No matter what your tax tech stack looks like, odds are there are some tools and resources that can lighten the load—saving you both time and money.
Estimating your expenses is important for submitting your quarterly tax payments. The number should be as accurate as possible, but you don’t want to spend hours finding it. In addition to income, you can deduct business expenses to save money come tax season.
This calculator from TurboTax makes it easy to understand how much you can deduct based on how much you’ve spent on things like travel, hardware, software, advertising, insurance and other expenses.
2. Do You Have All the Necessary Documents?
Got all the right tax documents? Not totally sure? Use this checklist to make sure you’ve got all your bases covered. It’s easy to let one or two crucial forms slip through the cracks accidentally, especially if tax codes change.
Just input a bit of simple data about your tax status, and it will tell you all the documents you need to prepare.
3. Calculate Your Employees’ Payroll Tax
Calculating paychecks can be a huge time suck. For a lot of small business owners, the process involves a bunch of spreadsheets and tax withholding tables to make sure they are getting the taxes and deductions just right.
Using a free paycheck calculator streamlines a lot of this process, and can do the heavy accounting labor of getting the taxes straight when you run payroll.
4. Mark Your Calendar with Important Dates
Americans generally think of one looming date as “Tax Day.” But if you’re a small business owner, you know there are a lot more dates to keep track of in your calendar—all year round.
Using a free calendar to mark the dates you need to pay attention to each month is crucial, whether that means filing forms or. Make sure you use a calendar that’s specific to your tax needs. Deadlines and due dates tend to be a bit different for C-corps, S-corps, and individuals.
5. Calculate Sales Tax Deductions
Sales tax deductions are huge for small businesses. They’re also labor-intensive.
This sales tax rates tool, created by the Quickbooks, helps small business owners know the right sales tax rates. If you use Quickbooks or TurboTax, your tax calculator will do it automatically for free.
6. Know the Difference Between 1099 and W2 Employees
1099? W2? Not sure?
Knowing how to classify your employees is a crucial aspect of running a small business, both for your sake and your team’s. And you don’t need a CPA to tell you how to classify—you just need a free tool to help you figure it out.
By inputting a bit of information about what kind of work your team does, and on what terms, you can quickly classify your employees and get the rest of your tax work ready to roll.
7. Check for Updated Laws in Your State
Tax codes change. Sometimes these changes make headlines and you know about them in advance, but smaller ones that can affect your taxes—such as eliminating certain tax forms or requiring online filing—can slip under your radar. Even if you’re a seasoned veteran and have handled your business’s taxes for years, it’s crucial not to rely on old habits.
States regularly make changes—large and small—to the tax code that can affect what your small business owes. Make sure you use a reference like this list to see what the laws are this year.
The tax code introduces business owners to a new world of terms, jargon and, of course, forms. It can be overwhelming, so we created a guide to some of the most common lingo you should understand. Whether you’re doing your own taxes or working with an accountant, a command of the language will save you time and hassle.
