Do you have the information you need now for your tax preparation in Atlanta, GA?
It’s never too early to start thinking about your tax preparation in Atlanta, GA. January is the perfect time to get prepped for tax season. But what exactly can you do in January to get you ready? Here’s what you need to know:
Understand Your Tax Deductions
Tax laws for small businesses allow you to deduct anything that is “ordinary, necessary, and reasonable” when it comes to your expenses. Interpreting that code is another matter. What is considered ordinary? Or necessary? Or reasonable? One man’s reasonable is another man’s extravagant. So how do you know? The IRS will tell you that if an expense is helpful and appropriate, it’s generally going to be considered an allowable deduction.
An example might help. A new printer for you and your employees to use for work related print jobs would be a deduction. A new printer for you and your family to use to print birthday invitations and fantasy football stats on would not be a deduction.
You will also need to understand deductions for items that are used partially for work, such as your car or your home office. If you use your car for work and personal use, you’ll have to deduct your personal use time and expenses from the mileage and use for work. This will require careful tracking and some end-of-year calculations. For your home office, you can only deduct it if it is used only for your business and not for personal use as well.
There are many guidelines and restrictions that you can find online from the IRS or that you can get from your accountant. Keep this information in mind as you pull together your receipts from last year for your filing and as you plan your budget and spending for this year.
Make Sure You Have Two Things: A Good Accountant and a Good Software Program
A good accountant can not only pull together all of your tax information from the previous year and get it filed for you, but they can also give you guidance on how to plan for the coming year to get the most benefits from tax breaks, deductions, and employee and payroll management. Trying to decipher the tax code on your own can turn into a nightmare for you and your taxes. A good accountant is the best way to help you get prepared for the new year.
A good software program is the next thing you need after hiring an accountant, and the good news is your accountant should be able to recommend and implement the right software for the needs of your business. Having the right information with the overview you need for the entire year is invaluable. Plus it ensures all of your financial tracking is in one place, easily accessible when tax time rolls around.
Plan Ahead for Payments
Don’t wait until tax season to figure out how you’re going to pay your taxes. January is the perfect time to put into place a plan to set aside the money you’ll need once your taxes are filed. Take a look at your earnings from the previous year, consider your growth, and have your accountant help you estimate what your taxes will look like this year and next. A little planning can go a long way.
No matter how small your business is it’s important to prepare for tax season. Whether you’re an individual working alone or a small business with employees and overhead, being prepared for tax season starts in January. Having a plan can help take the sting out of filing.