Tax Planning Tips For Next Year And Beyond - InformationWeek
IoT
IoT
Mobile // Mobile Applications
Commentary
4/15/2009
11:16 AM
50%
50%

Tax Planning Tips For Next Year And Beyond

Figuring out your tax strategy after you've already spent the money and booked the revenue may work fine, but if you head further upstream and structure your financial management processes you can make tax prep easier, maximize your deductions, and minimize your tax liability.

Figuring out your tax strategy after you've already spent the money and booked the revenue may work fine, but if you head further upstream and structure your financial management processes you can make tax prep easier, maximize your deductions, and minimize your tax liability.The mid-April tax deadline has a way of focusing attention on tax preparation, but savvy business owners know that taxes demand year-round attention. With taxes top-of-mind, right now is a perfect time to review how you handle your business taxes and make some improvements. Start with these suggestions from American Express Open

  1. Retool Your System During Tax Season -- One of the best times to change the way you track expenses is when you are gathering information for filing. At that point, you are most familiar with any shortcomings in your system, whether it is a receipt-filled shoebox or a tax software package. Pay particular attention to the documents your accountant says are missing from your current return; create a system to store and retrieve these materials easily. Another reason to create a good expense tracking system is to be better prepared in the case of a lawsuit or audit; having ready access to organized back up material can save you time and reduce the stress that may be involved in retracing your steps.
  2. Manage Cash With Taxes In Mind -- Even successful companies may owe money at federal tax time. While it may not be as exciting to budget for taxes as it is for marketing programs or hiring, savvy business owners know that it is essential. To help facilitate paying quarterly tax installments throughout the year, you should plan your cash flow around this bill. Savvy small business owners recommend setting aside a certain amount of money each month, based on your previous year's tax liabilities. Budget for owing taxes even if your company is not profitable - your taxes are based on income minus IRS-approved deductions, not your revenues minus all your expenses.
  3. Separate Personal And Business Expenses -- To simplify record-keeping and tax filing, keep your personal and business expenses separate. Having a charge card for just your business expenses can help ensure easy record-keeping through year end statements and can serve to keep you on a budget by paying off all charges on a monthly basis.

American Express Open has also posted a short Q&A with CPA Brad Graves discussing changes to the tax laws that affect small business -- don't miss it.

Don't Miss:

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
Digital Transformation Myths & Truths
Transformation is on every IT organization's to-do list, but effectively transforming IT means a major shift in technology as well as business models and culture. In this IT Trend Report, we examine some of the misconceptions of digital transformation and look at steps you can take to succeed technically and culturally.
Video
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll