Business Tax Returns
For those of you who have your own business, you need to file your business tax returns. The kind of business tax you file will depend on what kind of business you are operating –C-Corporation, partnership, QuickBook, S-Corporation, Sole Proprietorship, Payroll, or LLC. Defining your businesses in a specific way goes a long way in helping you save on taxation.
For those of you who are first-time businessmen, have a checklist of items to consider while filing business tax returns, and see whether you have taken care of each individual item on that list.
Decide whether you wish to file your business tax returns on a cash basis or accrual basis. Income and expense recognition is different for both these bases. If you are a lender, you could file returns on a cash basis though the financial statements are on an accrual basis.
The next item on the list is to physically go through the tax forms that you would have to fill. Mark out those places where you need to fill in the numbers. Also check that you have answered all the relevant questions that apply to you on the form.
You also need to take a decision on the kind of depreciation method you wish to opt for. The IRS has a provision that enables a $100,000 deduction for equipment and furniture for the first year, as opposed to writing off the cost over next five to seven years. However, to make use of this option you should have declared a profit during your first year of operation. For a sole proprietorship venture from your home, you can deduct some portion of the residence as a business deduction. You have to fulfill certain criteria for this.
If you are working with independent contractors, get them to fill the W-9 form. Besides, maintain logs of all automobile-related expenses. Also, do not forget to take into account your self-employment tax, as this might end up being a major component of your tax returns. These are some key points that you can look at to ensure you have a smooth time while filing your business tax returns.
For more infomation on small business budgeting choose from the list below. |
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Banking - Business Finances - Economics - Insurance - Investing
Major Purchases - Personal Finances - Stock Market - Taxes
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