What is one tax preparation resource for small businesses? What are the benefits?
To help small businesses prepare their taxes, we asked finance professionals and small business owners this question for their best insights. From researching American Institute of Certified Public Accountants (AICPA) listings to taking a free course from the Small Business Administration (SBA), there are several small business resources to help you prepare and conquer tax season.
1. Research AICPA Listings and Peer Reviews
Most business owners should head to the professionals to use every deductible available, minimizing the money your business owes the IRS. Since this role is vital, you’ll want to thoroughly vet any accountants you consider, which is where the American Institute of Certified Public Accountants (AICPA) can help. Browse their listings and peer reviews of vetted CPAs, accounting companies, and local financial organizations to ensure they’re legitimate and trustworthy with your most sensitive data.
James Diel, Textel
2. Try eFile.com
The greatest solution for your business may be eFile.com, depending on its type and size. They have transparent pricing that is lower than most and a professionally relaxed and amusing style that is intended to put clients at ease. They provide tax estimation calculators, personal expert advice, and free audit assistance if necessary. The only significant disadvantage is that if your company is a C corporation, you won't be able to file Form 1120.
Edward Mellett, Wikijob
3. Look into the Directory of Federal Tax Return Preparers
The Directory of Federal Tax Return Preparers is a good resource for small business owners to find a tax return preparer based on their credentials, locations, and qualifications. The directory provides a vast network of qualified professionals recognized by the IRS or are holders of an Annual Filing Season Program Record of Completion. It is also being updated regularly to keep contacts reliable and relevant.
Jason White, All About Gardening
4. Use TaxAct
Suppose you are leaning on a tax resource for your business. You will want one that makes your business a priority and can do everything for any classification, and TaxAct has that capability. Taxes can come with many complexities and differences between state and federal filings, so having a resource to make those delineations clear and understandable is critical to avoid costly mistakes.
TaxAct provides complete filing capabilities for partnerships and corporations and gives the option to download forms or file online. In addition, it has discount and refund notifications in which they guarantee the greatest return, and for a small additional fee, they will provide audit support. TaxAct, unlike many preparation resources, is about business first, keeping its platform clean while preventing confusion between personal and company requirements.
Adelle Archer, Eterneva
5. Download TripLog to Track Travel Expenses
If you or any of the employees at your small business have to drive for work, you need to be using TripLog. For tax preparation purposes, it will make your life immensely simpler. The last thing you want to be doing come March or April every year is manually adding up miles from paper spreadsheets and aggregating all your travel expenses.
TripLog is an app that takes care of all that for you for just $6 per month. It tracks your employees’ direct mileage, but it also logs expenses related to work travel, such as toll fares, parking fees, lodging, and meals. Though not tax-related, it integrates with Google Maps to find the most efficient routes for your team. For me, when tax time rolls around, TripLog saves me from a massive headache. It’s a great resource for small companies with teams that travel for work.
John Ross, Test Prep Insight
6. Take Advantage of AARP’s Free Tax-Aide Services
The AARP Foundation is a not-for-profit that offers free tax help to anyone that needs it, including small business owners who have questions about their tax requirements and benefits. Tax-Aide volunteers can be found across the country and are IRS-certified every year, so you can rest easy that the knowledge they share is accurate and up-to-date with any policy changes. Tax-Aide services are available now for 2022 - they serve through appointment only, but you can easily book online.
John Li, Fig Loans
7. Invest in Receipt Management Software
Staying organized during tax season is the only way to keep your tax payments down, and in those crucial early years of business, every cent matters. Keeping track of paper receipts can be difficult and lead to missed deductions, and disorganization come tax time. Investing in a quality receipt management program makes tax time more efficient and helps you keep track of your monthly spending.
Receipt organization is not just for tax time. Staying financially organized can help you make more informed business decisions and keeps you from spending beyond what your business can handle. My personal favorite program is Receipt Bank. The storage possibilities are endless and compatible with multiple popular accounting softwares like Quickbooks and Freshbooks.
Peter Robert, Expert Computer Solutions
8. Refer to the Small Business and Self-Employed Tax Center
Several government resources help small business owners in their tax preparation, and the Small Business and Self-Employed Tax Center is at the forefront of these initiatives. This non-profit organization has a centralized directory of business forms and documents, including excise tax forms, tax provisions, and other resources. Small business owners can reduce the bulk of work from preparing their tax files and paperwork. The directory has a clear system that directs entrepreneurs to the necessary files and requirements they need to submit.
Georgia McBroom, Camper FAQS
9. Get The Entrepreneur’s Business Tax Pack
The Entrepreneur’s Business Tax Pack contains a workbook, a guide, and a checklist. The workbook helps you avoid penalties and fees by organizing your info in one place. The guide provides essential tips on write-offs, retirement plans, and deadlines. Lastly, the checklist simply lists all of the financial reports you’ll need in order to file. This handy 3-piece kit helps with organization across the board and is a massive time saver!
Jeff Goodwin, Orgain
10. Utilize TaxSlayer
TaxSlayer offers limited-time discounts making it the most affordable tax software for small businesses. They guarantee the maximum refund, or they’ll refund your fee. Beyond that, it’s the most affordable choice for less than simple returns. They also guarantee accuracy by promising to reimburse you for any penalties or interest charges and will be there for you in the case of an audit, providing support. In short, TaxSlayer makes taxes less daunting.
Elliot Schwarcz, Becca's Home
11. Save Money with the IRS Free File System
There are a lot of good tax preparation resources, but the best ones are free. There are free tax preparation firms that use specialized software by Intuit and H&R Block. There is also the IRS Free File system, which is also free. These resources allow a small business owner to file his return with no charge. The benefits are numerous because a small business owner does not have to pay for tax preparation software or a business tax professional to prepare the tax return.
James Scott, OzBox
12. Pay to Use TurboTax
TurboTax, the most well-known online tax filing service, is sometimes the most expensive alternative. However, it has the most beneficial features, such as several checks for accuracy, guaranteed maximum deductions, income and spending account importation, and more. TurboTax meets a wide range of small business requirements. While the price may be off-putting, you may find that many of the extra services are worthwhile.
Dr. Frederik Lipfert, VPNCheck.org
13. Buy the Thomson Reuters 1040 Quickfinder Handbook
While I suggest small business owners hire or contract a qualified and experienced tax professional, you can buy a copy of the resource that sits on the bookshelf of almost every good tax preparer. Thomson Reuters 1040 Quickfinder Handbook is a comprehensive and easy-to-use reference for all topics of tax prep, including basic small business. It's updated annually, and there's a searchable eBook version available. I've always found the info I need in my copy. Most small businesses should also consider the specialized Small Business Quickfinder Handbook for in-depth tax prep needs and explanations.
Jonathan Vander Werff, CFP®, My Financial Coach
14. Take a Free Course From the Small Business Administration (SBA)
Though I urge even small businesses to consider an accountant, get prepared before you prepare your return if you're doing it yourself. The SBA offers a free course to give you the basic knowledge you'll need to prepare your own return. Just search for "Tax Planning and Reporting for a Small Business" and "SBA," online and it should be your first link. If you're skeptical, download it regardless. The first section is a quiz that will help you decide if you could benefit from the course. Your finances are too important to wing it. Educate yourself or outsource. You can't afford not to!
Patricio Paucar, Navi