Tax season rapidly approaching: Get ready now to file 2023 federal income tax returns in early 2024 Internal Revenue Service

business tax preparation checklist

While the IRS provides a PDF version of Form 1099-MISC on its website, you can’t simply print this form and fill it out by hand. Copy A of Form 1099-MISC must be printed using a special scannable red ink. Most small business accounting software includes the ability to electronically file 1099 forms. If yours doesn’t, or you don’t use accounting software, you can buy blank 1099-MISC forms from most office supply stores. If you have business locations or employees in several states, you may need to break down the income, property owned and wages paid in each state.

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We have also created a downloadable tax checklist to make sure you don’t overlook a single step. It helps to find out what other business tax preparation services charge their clients. The idea is to gain insight into the local tax preparation market so you don’t over- or undercharge.

Taxes you’ve paid

Knowing the common small business deductions and credits that may apply to your business is an important step in preparing your business taxes. Preparing taxes is no fun for most small business owners, but it has to be done. By following this simple checklist, you’ll put yourself in the best position to get your small business tax return prepared quickly and correctly. For most people, April 15 is the date that sticks in their mind for when they have to have their individual tax returns done. But for small businesses, deadlines can depend on what type of business you have and how you’ve chosen to set it up for legal purposes.

business tax preparation checklist

Forms known as 1099s serve as “tattletale” documents to help the IRS ensure taxpayers are reporting all their income. If your business is service-based, you will likely receive 1099s from a number of your customers. If you provided any work for a company or individual as a non-employee, you’ll receive a 1099-MISC form. Since 2012, credit card processors and payment processing companies like PayPal and Stripe have been required to issue a new kind of 1099 called Form 1099-K.

Estimated Tax Payments

Filing your small business taxes requires basic personal information. Make sure to have this information on hand when filling out your tax forms or written down for your accountant or tax professional if you’ve hired one to file your tax return. The information needed is pretty simple, but you must ensure that you (or your business tax preparation checklist tax pro) input it correctly to prevent any delays with the IRS. Read on to learn more about the information you’ll need for your tax return. Instead of hiring an accountant to prepare and file your taxes only during tax season, it’s a good idea to have an accountant work with you and your bookkeeper throughout the year.

It reports the partnership’s income, losses, gains, deductions, and credits, and you must file the form, or an extension, by the March 15 due date. Excise taxes are imposed on certain goods and services, and not all businesses have to pay them. If you deal in any of the following, excise taxes may apply to you. State income taxes vary, and they sometimes include county taxes.

Gather the needed business tax return documents

Form 1099-K is used to report credit or debit card payments in excess of $20,000. Form 1099-K is also issued when a payee receives payment for more than 200 credit or debit transactions in a year, regardless of the annual dollar amount. That’s why this tip makes our small business tax preparation checklist. Following this tax preparation checklist will help you get organized and ready for tax season. While dealing with your small business taxes might seem overwhelming, using reputable accounting software can help.

business tax preparation checklist

This can also help you create customized tax solutions for each of your client’s businesses, which might save them money in the long run. If you wish to offer greater affordability, consider doing it as part of an overall service package that balances price with quality for select clients. It helps to cultivate more loyal and long-lasting client relationships as well. For example, you can bundle your service to include books cleanup, tax preparation as well as tax planning services for a lump sum price. Our small business tax professional certification is awarded by Block Advisors, a part of H&R Block, based upon successful completion of proprietary training. Our Block Advisors small business services are available at participating Block Advisors and H&R Block offices nationwide.

Compare the best tax software of 2023

Businesses with different legal structures have different tax preparation needs. Sole proprietorships are not corporations and can’t be treated as such. Many tax preparers create client organizers to help ensure their clients are fully prepared for their tax appointments. Asking for a client organizer or other guidance from your tax preparer can prevent many headaches as you prepare for your tax appointment. Tax credits are a dollar-for-dollar reduction in the amount of tax you owe.

business tax preparation checklist

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