Nobody likes to pay taxes. But the reality is that every business owner has to file them.
Many business owners naturally fear that the IRS will hunt them down and penalize them for owed back taxes. The good news is that only 2.5 out of every 100 small business owners get audited by the IRS.
If you want to become one of the businesses out of the IRS’ view, it’s time to learn about business tax. In this guide, we’ll teach you everything you need to know about small business tax.
1. You Can’t Feign Ignorance
Paying taxes is every American citizen’s civic duty. You can’t get out of filing a business tax return just because you don’t know anything about the process.
If you fail to file a business tax return, you’ll be forced to pay back taxes on what you owe. Also, if you make a mistake on your tax return, the IRS may audit you.
This information isn’t meant to scare you. It’s just to warn you of the reality that the IRS expects you to know about the country’s tax policy.
2. Don’t Delay Your Taxes
Delaying your taxes is delaying the inevitable. Every year, there is a deadline for businesses to submit their tax returns.
For example, the business tax deadline in 2021 was on April 15th, 2021. In 2022, this deadline has been shifted back to March 15th, 2022.
If you miss the deadline, you may be forced to pay penalties and interest on what you owe.
This is why it’s important to partner with a tax advisory service so you won’t be late.
3. You Don’t Have to Be a Tax Expert
It’s your responsibility to know about every operation that happens in your company.
While many business owners aren’t experts in marketing, they at least know the basics of how to promote their companies.
In the same way, you don’t have to be a tax expert to chase after deductions and lower your taxes every year.
It’s recommended that you hire a tax expert, but it wouldn’t hurt to read and learn about the U.S tax code.
4. You’ll Need to Learn About Business Law
Taxes and law are two concepts that are linked together. Small businesses often pay lower taxes than corporations.
This is because corporations earn more income. Also, corporations can legally exploit the tax system to save money.
Understanding business law is crucial in filing taxes the legal and affordable way.
5. You Can Use Several Online Tools
The internet has made it possible to use countless online tools for tax purposes.
Quickbooks, Turbo Tax, and H&R Block are all examples of companies that allow business owners to manage and file their taxes online.
There are also plenty of businesses that will help you use these tools to file your taxes.
This information goes to prove our first point. With all of these tools available, there is no excuse for neglecting your business taxes.
Learn More About Business Tax
As you can see, business tax isn’t a difficult topic to learn. In fact, spending a few minutes in research will help you learn all of the basics of business tax.
Do you want to learn more about how to run a business properly? If so, check out more of our articles.