Choosing the self-employed career path gives you a lot of personal power, and as we know, with great power comes great responsibility.
And one of those responsibilities is paying your taxes... But, just because you’ve chosen to shoulder additional responsibilities as a small business owner doesn’t mean that your stress level needs to rise just as much as your commitments have! You can learn how to cover all of your bases without stretching yourself to a breaking point.
One of the reasons tax season can be so stressful is because we try to ignore it for 11 months of the year. Running a business really requires you to be mindful of what and when taxes must be paid, and also how your income affects what you owe.
When you are aware of your tax obligations all year long.... tax season will no longer be a seasonal stressor, instead it becomes a review of what you’ve already done (and saved). For...
The 1099-Misc form is used to report non-employee income payments. If you only have regular employees, you’ll be giving them each a W-2 instead.
As a small business owner, it’s very likely that you will receive and send a 1099-Misc form at the beginning of the new tax year. These forms are used to show the IRS what you paid any non-employee workers.
If you’re are a contractor, your employers will send you a 1099 as a tax document recording how much money they paid you for that tax year. You will use these documents to provide the IRS with gross amount of money that you made as income for the tax year.
As a small business owner, there are several conditions under which you are required by law to send 1099s to your vendors or contractors:
Tax season is many things, but no one describes it as fun. In our combined 25+ years of accounting and media experience we’ve seen the gamut of incredible and incredibly bad situations. Whether you’ve suffered from being unprepared, overwhelmed, or confused, we’ve been there with clients before, and we’re not going to let you go through it alone!
That's why we're going over some of the strategies we discuss in our free Tax Savings Guide.
Whatever the reason you dread tax time, we have ways that you can save yourself both headaches and money.
Tips to Save on Your Small Business Taxes:
Below are a couple of ways to help you save money on your small business tax return. Secure more deductions on your tax return and be less stressed in the process; it’s easier than you think! If you’re not familiar with the perks of good bookkeeping, you should check out this blog post breaking down exactly why it is so useful to your business.
Do you ever work from home?
Do you have a separate space at home designated for regular & exclusive business use?
Now just to be clear….. We’re not talking about the kitchen table or your guest bedroom!
We’re talking about a separately defined space in your home where you only work on your business. If this applies to your business operations from home... then you may be entitled to deduct the expenses for the percentage of square footage your home office occupies.
I was surprised to learn (and you may be too) just how much you can save…. The IRS says this tax deduction brings self-employed persons who qualify, an average tax savings of $3,000 each year!
Okay, so how do we get this deduction? You can claim the deduction one of two ways outlined below....
You can deduct a percent of your actual expenses based on the portion of your home devoted to regular & exclusive business use. Included in the...
Stay up to date on all the latest tips, tricks, and tools from Bookkeeping Academy Online.