Working with business tax services can be a huge help, but in order to make the most out of it, you need to avoid these mistakes.
Looking for the Cheapest Solution
Finding a professional of any kind based on price is not going to be the best option and may even cause you to spend more money. Instead of looking at cost, look at the Better Business Bureau, check credentials, and get recommendations from other businesses in the area.
Don’t Just Work with Them during Tax Season
You should want someone who is going to look at the company’s financial statements quarterly to help you create a plan to minimize business taxes. Tax professionals should be able to tell you about changes in the tax law and how they are going to affect your tax strategy. You want someone to meet with you on a quarterly basis so you can discuss long-range planning for the future and make sure you get questions answered about profits for the next few years and how you see your business is growing.
Hiring a Non-Professional
When it comes to your business taxes, you want a professional and someone who is qualified. You don’t just want to go to your neighbor who thinks he is an expert since he occasionally dabbles in taxes.
Playing Defense
Your tax professional should play offense on taxes and go after tax-saving measures. You don’t want to be playing defense and instead, your strategy should be to pay the least you can in business taxes, legally.
Not Paying Attention to the Bigger Picture
Your business is going to be more than just doing taxes but the tax strategy you choose should also be a part of your bigger business strategy. What could be the best solution to a tax issue might not be the right choice for your business as a whole. For example, if your tax advisors want to form an S corporation instead of your sole proprietorship, it could be a good idea for taxes but corporations can be confusing and you need to understand all the complexity.
Accepting Easy Answers
Don’t just accept any solution proposed by a tax advisor as to the best one and do some research or get a second opinion if necessary. It’s not that you don’t trust them, it’s that you are the one who is responsible for the tax return and you want to make sure that you are doing things right. Find business tax services to work with that will guide you through the decision process so that you know exactly what it means.
Doing Business Taxes Yourself
One of the biggest mistakes you can make when it comes to business taxes is trying to do them yourself. Business taxes aren’t the same as personal taxes and there are complicated reports, such as depreciation or cost of goods sold. Unless you have spent hours studying these things, this mistake could cost you a lot of money.