NEW

5 Critical Tax Tips For Nonprofits in 2019

No one enjoys filing taxes, but it can be especially problematic for nonprofits. Many nonprofits focus on their cause so much that they neglect proper organization. As a result, they deal with disorganized records and systems, and a lack of clarity around tax issues....

THE SMART BUSINESS OWNER’S LIST OF TAX DEDUCTIONS

For a business owner, taxes can be overwhelming and cumbersome. Tax deductions allow you to save thousands of dollars each year on your taxes and make tax filing a much more bearable experience. In this post, we'll list some of the tax deductions you can use to...

The Smart Business Owner’s List Of Tax Credits

One of the best ways to cut costs as a business owner is to take advantage of all the tax deductions and tax credits for which you're eligible. As a business owner, you're concerned with the bottom line--increasing your net profits. That probably means you spend most...

PRESS RELEASE: Cassidy Jakovickas, CPA of Fresno, CA Appointed to Intuit’s Accountant Council

Select Panel Advises on Products and Services that Accountants and Their Clients Want Most             FRESNO, CALIFORNIA – June 4, 2019 –Today, Intuit, Inc (Nasdaq: INTU) announced that Cassidy...

Beyond The Numbers: What We’ve Been Reading

Although our team loves using numbers and spreadsheets to help our clients make the best financial decisions, we also enjoy reading great books. Staying well read on both fiction and non-fiction books helps us hone our imagination and introduces us to new, sometimes...

Looking Back At April

It’s hard to believe that we’re at the end of April, but it’s true! This month, we helped our clients wrap up another great (and busy) tax season. There was, as always, a lot of paperwork, emails, and nail-biting involved in the days preceding April 15, but that’s all...

5 Last-Minute Tips For Filing Taxes in 2019

Well, April 15 is almost here, and the tax-related panic is thick. If you haven’t filed your 2018 tax paperwork and are rushing to get your taxes in by the deadline, we’ve decided to give you some last-minute tax advice that will hopefully help ease your stress....

An Introduction To Cybersecurity for Business Owners

Keeping your sensitive business and customer data secure has never been more critical. Whether you are a small business or a national corporation, you can't relax your defenses against those criminals seeking to take advantage of lazy cybersecurity policies. Virtually...

March News Roundup

Wow! It seems like we just started March and we’re already moving into April! As we move into the final stretch of tax season, we’re recapping this month’s news for you, just in case you missed it amid the tax-related hubbub. MBS Accountancy: November Review This...

4 Key Changes To Depreciation Under The TCJA

As the Tax Cuts and Job Act (TCJA) continues to be unraveled by tax professionals, it’s important to review the changes and their implications on business operations and tax strategies. In this article, we’ll highlight TCJA’s changes to first-year bonus depreciation,...

Common Mistakes Made By Small Businesses (And How To Avoid Them)

Reading Time: 2 minutes

Running your own business can be stressful at times, especially during tax season. Taxes are especially burdensome to business owners who complete their own taxes without any real knowledge of taxes. Many times, when business owners complete their business taxes without any tax knowledge, costly mistakes are made. While this article is not a replacement for a tax professional, we are going to discuss how to avoid the most common mistakes made on small business taxes.

Home Office Expenses

Deductions for home offices are meant to account for the expenses you incur as you run your home-based business. Many business owners avoid the home office deductions altogether because they are scared of an IRS audit challenging those deductions. However, if you claim home office deductions correctly, you do not have to worry about an IRS audit. To qualify for home office deductions, you need to either:

  • Use your home office exclusively and consistently as your primary place of business
  • Meet clients in your home office on a regular basis
  • Have a home office that is solely used for business and is physically separate from your home’s structure.

Your Tax Responsibility

Many small business owners are unaware of their tax responsibilities and, as a result, usually, have to pay a hefty tax bill at the end of the year. As a business owner, you are responsible for knowing what taxes are applicable to your business and for paying them. States, counties, and different districts may have their own tax requirements, in addition to the IRS requirements. For instance, businesses in California are subject to one or more of the following types of income tax: alternative minimum tax, franchise tax, or corporate tax. Additionally, there are other taxes like sales tax, property tax, payroll tax, local tax, excise tax, etc. that may apply to your business that you may not have realized until now. It is also important to remember to pay the self-employment taxes and the accompanying tax payments. Understanding your responsibilities as a small business owner will help you to avoid the costly penalties and fees that come with failure to pay the appropriate taxes.

Detailed and Updated Records

The importance of keeping good records as a business owner is sadly underestimated by many business owners, both new and established. While it can seem tempting to simply determine your annual income at the end of each year, this practice costs you valuable information about your monthly net income and specific resource allocation. This information is necessary for you to make any efforts to increase your profit and adjust expenses. Save yourself money and a recurring annual headache and keep good records.

Need Help? Contact MBS Accountancy

Choosing a locally trusted tax professional to help you navigate your taxes is a sure way to avoid costly penalties and fees. We will gladly consult with you about preventative tax filing behaviors and complex tax issues that may be present in your situation. Contact us today and learn how we can help you be worry-free at tax time!

Previous

Next

Submit a Comment

Your email address will not be published. Required fields are marked *