Most tax years require relatively similar information to the year prior, but business owners in 2023 have the unique opportunity to do more this tax season.
Do’s:
- Apply for tax credit / grant programs, like the Employee Retention Credit (ERC) through a trusted source, to secure additional cash flow for your business.
- If you’re behind on your books, work with an online bookkeeping organization to help you quickly and accurately catch-up. Groups like Xendoo offer catch up solutions and provide the added benefit of identifying potential tax savings through their bookkeeping work.
- File your taxes on time and make required payments to keep your business in good standing. In a rising interest rate / credit tightening environment, the most affordable capital is typically available through government-backed loans, such as SBA 7(a) loans, which require your business to be in good standing to qualify.
Don’ts
- Wait to apply for tax credits available through expiring programs. The IRS’ activity is expected to increase during tax season, which may slow their refund check processing time. This means you have to wait longer to receive your credit or refund check.
- Try to do your taxes yourself. Tax laws are prone to changes and adjustments each year, which can positively or negatively impact the amount of taxes you may owe. To take advantage of beneficial government programs and abide by new tax legislation, it is best to hire a professional to prepare your taxes.
- Miss the opportunity to use your taxes as a tool to identify future adaptations and process improvements that could help your business grow next year. Understanding how and where your business earned, spent, and invested money, and where you were taxed based on those activities, can be used as a guideline for improvements in the year to come.
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