The year ended 2014 tax season began January 22nd 2015. Every year businesses are required to file an income tax return. In the US, the federal income tax is due as it is earned during the year, which makes it a pay-as-you-go tax. All businesses except for S-Corporation, Partnership and Limited Liability Company, which file an informational return may be required to make estimated income taxes payments during the year. Unlike an employee whose income tax is withheld from their income, a business’ income tax is not and thus, the business has to make regular estimated income tax payments during the year to avoid late payment penalty fees when the return is filed after year end.
As a business owner, how do you prepare for getting your business return filed timely and accurately while making sure the result is the most favorable to your business ? Unlike what most business owners believe, filing your business income tax return does not always have to be a headache. Here are some steps to take to make your business income tax filing less of a headache:
- Consult with a tax professional – This should be done throughout the year, a tax professional is usually an underutilized asset for a small business owner. Business owners should consult with their tax professional on a regular basis during the year, not just when the tax return is due.
- Review and reconcile your company’s books – Businesses are required to keep complete and accurate records. In order to make sure your business return is reliable and accurate, you should review your accounting records, make sure all your banks and other statements are reconciled and that your account ledger balance for the year ended accurately reflect your company performance for that period.
- Make sure document support is properly filed – Proper maintenance of accounting document support is important and often overlooked by business owners. Proper maintenance of accounting document support help ensure that accurate and reliable transactions are posted to the company’s books and can be used when needed to verify, reconcile, and or vouch a transaction. It is very important to organize and maintain your accounting document support in an organized and easy-to-use filing manner.
- Schedule an appointment with your tax professional – As soon as possible, once the above steps are completed, put together your business financial statements for the tax year and get with your tax professional to go over your information and any other additional information he/she may need from you to be able to timely and properly prepare your business income tax return.
As much as one would like to be on time as far as deadlines are concerned, it is fair to acknowledge that things happen and that some of you may not be able to meet the tax return filing deadline. If you foresee not being able to timely file your business return, no panic, you can always request an automatic extension to file and pay if applicable any estimated tax you anticipate owing when you file. Talk with your tax professional if you fall in this category; it is better to file late after a timely extension than to file erroneous information on time.
Below are some federal income tax return filing deadlines for business with calendar year end along with some links you may find interesting:
March 16, 2015: Deadline for corporate tax returns for the year 2014, or to request automatic 6-month extension of time to file.
April 15, 2015: Deadline to file partnership tax returns or to request an automatic 5-month extension of time to file.
May 15, 2015: Deadline for tax-exempt organizations to file information returns (Form 990) for the year 2014, or request an extension.
Small Business Record Keeping: http://www.irs.gov/Businesses/
Publication 509 (2015), Tax Calendar: http://www.irs.gov/
Publication 583 (01/2015), Starting a Business and Keeping Records: http://www.irs.gov/
Business Taxes: http://www.irs.gov/Businesses/
Written by Dimitri Yimga, MBA is a Certified Public Accountant and the founder of DY CPA LLC in Anchorage AK. He is also a Certified Valuation Analyst, a Certified Fraud Examiner, and a Chartered Global Management Accountant. His practice include Financial Statements, Business Taxations, Business Valuation, Forensic Accounting, and Litigation Support. Learn more about Dimitri Yimga at www.dycpas.com Call 707 377-3003 or email firstname.lastname@example.org