The IRS will accept an amended return up to 3 years after the date you filed the original return or within 2 years after you paid the tax due on the return, whichever is later.
In unusual tax situations, such as net operating loss (NOL) carrybacks, general business credit carrybacks, or situations involving bad debts, you may be eligible for extended amendment deadlines.
However, for the most part, the deadline to amend a 2011 or earlier return has passed.
1: Auto Deductions If your work takes you away from the office, make sure you are keeping track of travel expenses. Don’t assume that the Standard Mileage Deduction (57.5 cents/mile for 2015) is your best bet: You should add up all actual car-related expenses, multiplied by the percentage of business use, and calculate which gives the largest deduction for you. If it was a year for large repairs, new tires, and more, the actual expense approach may be the better option.
2: Travel Deductions If you are headed out of town for a business trip, be sure to keep all your receipts. Most of the costs of your trip are fully deductible, with the exception of meals and entertainment (50%). Don’t forget fees you might not normally think of, like airline baggage fees, meals eaten while traveling, tips paid for services, or dry cleaning.
3: State Tax Deductions As a small business owner, you have the choice as to whether you want to deduct State Income Tax or State Sales Tax on your Federal return. This assumes that you live in a state with a state sales tax. Compare the two, and see which will give you a larger deduction – you may be surprised.
4: Bad Debt Deduction As a small business owner, you might unfortunately encounter a customer or other business that won’t pay what they owe you, no matter how many times and how hard you try to collect. You must keep track of goods or services rendered, and what you did to try and collect the debt if you are going to take this deduction. For more information, refer to the IRS Publication 535 – Business Expenses.
5: Charitable Donations It’s not only good for your business and community to participate in charitable donations, it can be good for your taxes, too. Businesses can write off between 20-50% of their gross income in charitable deductions, although most don’t rise to that level of giving. Make sure you keep your receipts, and if you are giving goods and/or services, you can deduct the cost to you, not the retail value.
6: Lifetime Learning Credit Whatever classes you want to take to enhance your business, you can deduct 20% of the first $10,000 in expenses per year, up to $2,000 per year. The school you attend must be accredited in order to qualify for the deduction. You can also deduct the cost of business-relevant subscriptions to online and offline publications, manuals and books.
7: Start-up Expenses Is this your first year in business? You are allowed up to $5,000 of start-up expenses, which include any money paid in connection with creating an active trade or business
It’s amazing that as a small business owner, you wouldn’t hesitate to ask for professional help to fix a plumbing job or to repair faulty machinery. But when it comes to tax preparation and financial consulting, a lot of business owners opt to go it alone. This decision not only means hours of additional work for you, but also could cost you more money in the long-term from poorly made financial decisions – negatively impacting your bottom line.
If you are weighing the possibility of enlisting expert help with your taxes, you may want to consider the following advantages of going with a professional tax advisor:
1. You are freed up to focus on your business growth - not the details of your taxes.What is your time worth? Probably a lot more than you realize. Put a value on the time you spend on taxes and tax-related tasks, and then compare that to enlisting professional help. The time that you spend on trying to do taxes yourself is time that could be much more wisely spent on focusing on your business.
2. You gain peace of mind by enlisting a professional who knows your business and your taxes.Not only will you likely save money, but you are gaining peace of mind that knowing that your taxes are being handled by a professional – and that they understand all the tax minutia and details, and how to leverage tax laws to minimize the cost of taxes for you. Tax law changes so frequently, it is nearly impossible to keep up – which is why a professional can make all the difference.
3. You have someone to go to for advice - any time of the year, for any tax-related reason.Ideally, the tax professional you choose should be available to you all year – not just at tax time. The reality is that tax issues and savings opportunities can arise any time of the year. Whether it’s how to structure investment in inventory, or how to handle an unanticipated tax notice from the IRS, a tax professional can provide timely, informed guidance that optimizes your financial business decisions and minimizes risk.
4. You have a professional that understands you and your business.The ideal small business tax advisor will have not only proven expertise in all areas of tax preparation and tax planning, but will also have experience with your particular business and its unique tax opportunities and challenges. You get the advantage of understanding how you compare with other businesses like yours - and where there is room for improvement.
5. You have a professional to focus on all your small business taxes - including income, sales and payroll tax.Let’s face it: small business taxes can become quite complicated. You need to comply with multiple tax codes, including sales and payroll taxes. For sales tax, a tax professional will work with you to ensure you are in compliance with all the latest requirements and government processes. For payroll, tax, a professional can help you understand how various compensation models will impact your bottom line. Mike McVay, Accountant 850-725-5696 - www.VirtualBookkeepersUSA.com
Mike McVay, Tax Accountant Blog
Certified QuickBooks ProAdvisor & Licensed Tax Accountant Pensacola, FL
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