Taxes are probably the last thing anyone wants to think about in the new year, but with April 15 just a few months away, it’s time to start getting things organized. Here are some quick tips to get you started on tax preparation:
- If you have moved your business address during the year, make sure you have informed all your banks, brokerage accounts, mortgage accounts, retirement accounts, clients, and payroll companies of your new mailing address. Don’t risk having your year-end documents delayed.
- Make a list of the clients who should be sending you a 1099 form in January. Check your income totals for each so as you receive them, you will be able to quickly verify that the amount reported on the 1099 is correct.
- Find and organize all of your medical receipts and reimbursements, as well as your cash and in-kind donations for the year. Also, this is the first year that tax filers will have to report on their health insurance in accordance with the Affordable Care Act, so be sure to have that information ready as well.
- Have your bookkeeper reconcile your books for the entire 2014 fiscal year. Now is a good time to review the payroll year-to-date totals, cash balances, payables, and receivables with your accountant.
- Did you remember to send all of your 1099s? February 2 is the deadline for businesses to send out these reports for all of their freelancers and contract workers. Make sure you have the most current W-9 on file for each of them so that reporting is accurate.
If you haven’t already done so, have your accountant prepare a tax projection for you based on your income and deductions for the year. As a small business owner, there are still some opportunities available to you for reducing that tax bill, such as making a tax-deductible contribution to an IRA or SEP-IRA. Talk these opportunities over with your financial adviser—you may be surprised at what’s available to you!