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Tips for Corporate Tax Preparation

Tips for Corporate Tax Preparation

Filing for individual tax is one hassle in which you need to make sure that you maintain all the proper skills, records, and knowledge to render your tax files complete and secure. But corporate tax preparation is a whole other ballgame.

Here Are Some Tips to Help with Your Corporate Tax Preparation

Corporate Tax Preparation Is Confusing, so Go Get Help Sooner Than Later

It’s important as a business owner who plans to file taxes for their corporation, to make sure that their financial sheets meet required standards that are on par with the best financial principles practiced.

With that said, if you already know that it’s way too much work ahead for you to accomplish correctly, don’t waste your time on trying to figure out how to record your finances, read your financial sheets, or file taxes all on your own. Get a professional tax preparer to do that work for you, and learn on the way.

If you try to file your taxes or record your sheets all on your own, or in-house but with minimal expectations, you need to invest into a professional who will help and perhaps even do the work for you. You should hire him as early as possible.

The reason why you want to hire a corporate tax professional early on, is so that he can make sure your books and financial records are all organized and accurate. If you try to do it all on your own, without assistance, you’ll find that you might have misrepresented a certain account or financial sheet.

Your small hiccups could waste valuable time and money, especially if your professional corporate tax preparer has to reorganize your financial records, or redo your tax preparations from beginning to end.

Grab a Consultant Even if You Have Tax Software Helping You Do Your Taxes

Not only is getting organized important, but getting a corporate tax consultant to help you with your remote tax practices, or just to review your tax solutions done on a software, will help you become more comfortable with your corporate tax solutions.

This means that even if you plan to rely on corporate accounting software to help you organize and manage your tax preparation, it’s best to double check while using your software with a tax consultant (preferably someone who is well known to remote tax software) to double or even triple check your current financial records and tax filings.

Know How to Obtain Business Tax Deductions

The IRS has given rules to what you can legally consider to be a corporate tax deduction. Your corporate or business tax deduction as it’s known can be categorized as either an ordinary expense or a necessary expense.

An ordinary expense on your business, are costs you would normally see as a common, accepted, or ordinary expense seen in your trade.

A necessary expense on your business are expenses that are deemed necessary or logical to proceed with, in order to help your trade or business generically.
Knowing how to categorize your business expenses properly for deductions will save you money.

Questions You Should Ask before Hiring a Tax Accountant

Questions You Should Ask before Hiring a Tax Accountant

A business accountant is an essential must have in this business day and age. If you are a small business owner, having an accountant or not having one could make or break your business. I say this because, without having a clear understanding or knowledge of your financial development, how do you know if your business is actually growing, or your investment is worth investing in? Not only that, accounts have a variety of jobs in the finance world. Accountants, such as a Tax Accountant or Forensic Accountant are very crucial accountants for any business. But in this article, we will focus more on tax accountants.

There are many reasons to want to have a personal tax accountant to help you with your business. One reason for starters, a tax accountant will file your taxes, giving you time to do other precious work that needs to be done. Tax accountants also provide your business less stress, because you don’t have to worry about the IRS hitting you with a costly penalty for misfiling your taxes (that is if your tax accountant did their job correctly). Tax accountants will also help prepare you for any audits that might come up.

So, do you want to hire a tax accountant? Here are some questions to ask your potentially new employed Tax Accountant:

Questions to Ask When Hiring a New Tax Accountant

What Experience Have You Had in the Field?

This is an important question, because it shows the level of intricate knowledge he has with the best general practice in tax accounting. If he has experience in the field, he will obviously be more reliable than a person who is just getting their feet wet in tax accounting.

This specific accountant might have started off as a different type of an accountant. But if he has had relevant experiences in the field that meet your company’s goals, then you might have found your new tax accountant. Better yet, if he has had tax accounting experience in your own specific field and industry, then that’s a plus. It would be nice to know what kind of clients they have had. Perhaps the work they did for their clients meets the industry knowledge they should have for your business too.

How Often Do You Think You Can Get My Work Done?

When hiring anyone for any position, assessing their level of skills and capability to do the work is essential for any new employee. So, one question to ask your new candidates is how quickly they think they can get the work done (without decreasing quality in the work). An honest answer to the question should provide the candidate brownie points for their honesty.

Who Will Do What Work?

Understanding who does the work is also very important. There are plenty of tax accounts who decide to outsource some of their work to a third party. This doesn’t mean that their work is less noticeable or the work will be diminished, but at times, when asking your tax accountant about certain steps they took, it could be hard for you to get an answer from them in a timely fashion. So, when you hire or invest into a tax accountant, it will be to your benefit to know whom and where they will outsource their work if they choose to do so. This will help save you time in getting information you need about the tax accounting process.

It’s not bad practice for your tax accountant to hire outsourced workers to do their jobs better. But again, to save you time and effort, it’s better to know who to talk to, in order to get the tax accounting data you need.

Who Are You, and What Will You Bring to This Company?

There are plenty of accountants out their looking for your business. They would love to be hired by you, because you can help provide these accountants food on the table for them, and perhaps event their families, so it’s obvious to believe these accountants want your money in exchange for their services. But! How do you know which accountant fits your business entirely?

Sure, being a tax accountant who has done work for clients like yourself, who are in the same industry as you are is a plus. But! Do they see things the same way you do too and are they understanding of where your business stands in its profession? Do they understand the business mentality and culture? Will they be able to see things the same way as you do, the business owner or manager? Does the tax accountant understand and fit well within your business environment and culture? Can this tax accountant grow with you, or perhaps help lead you in better growth?

What I am trying to say is, you should assess the tax accountant as a person, and question if his character fits well in your company. This will lead to the next question to ask before hiring your tax accountant, what kind of accountant are they? What kind of tax accounting do they follow? Are they a more aggressive or conservative Tax accountant? Will they be able to flip flop, depending on the situation?

Aggressive or Conservative Tax Accounting Principles?

It’s important to know how your accountant practices their accounting. An accountant is not just a person with the ability to count and work with numbers, but an accountant is a human being, who should be able to express what these numbers means and to give quality advice to their employers on financial situations after calculating the numbers. So, depending on his personal stance of how to practice good tax accounting, it will be left to the employer to make the final decision whether to hire the candidate or not.

A more aggressive accountant wants to probably write off everything they can, while other accountants will take to a more conservative approach. If introduced with two possible solutions for an uncertain accounting problem, they would tend to select the worst case scenario solution in order to keep the business on guard for unforeseen circumstances.

Being able to balance between an aggressive and conservative approach is ideal for accounting, but timing is almost the most essential aspect on whether or not to be aggressive or conservative. If experienced, this accountant should be able to determine (with the data viewed and acquired) when it will be a good time to stay aggressive or conservative in a tax accounting manner.

Each scenario can be different, depending on time, a company may have a more aggressive approach in achieving their goals, while at other times, a company may plan to do cutbacks and stay passive in their expenditures, and so on.

Asking these questions will help you find a suitable employee for your tax accoutering position.

Save more, Pay less

Save more, Pay less

When it comes to paying your taxes, chances are you are probably overpaying or there are options that you have not explored in order to pay less. Here are a few ways to significantly reduce your taxes.

Charitable Giving

Charitable giving is a great way to receive a significant tax deduction. This can include:

1. Using your automobile to provide services for a charitable organization
2. Donating appreciated property
3. Sponsoring a student that lives in your home (exchange student)
4. Providing food, lodging, and clothing for a disaster relief organization

Taking care of family

While child support is not deductible, alimony is. You can also see a tax deduction if you incur medical expenses of a parent for whom you provide over 50% of support.

Home improvements

Any home improvements made for medical reasons (elevators, spas, swimming pools, etc.) make you eligible for a tax deduction.

Save money on the job

Did you know you can even save money just for working? Receive tax deductions for employment agency fees, job-related moving expenses, job skill improvement classes, and even child care cost while you work and attend school.

Don’t forget your details

When going over your expenses with your accountant be sure to include all the details as they would know of where to find you tax deductions. Establishing a strong relationship with your accountant is key to achieving the lowest bill possible.