There are hundreds of ways for a small business owner to minimize their tax bill. Although the first two tips below may seem obvious, most small business owners pay too much tax because they aren’t tracking those two items properly. As for the third tip, a small business owner rarely saves money by doing their own taxes. Read on to find out why.
Basic versions of these software packages may not contain all the forms you need to file and they may not help you find additional tax credits and deductions.
You will also need receipts and other documents for deduction purposes to claim on your tax returns. Deductions reduce the taxes you owe because it tells the IRS that after deductions, your income is smaller. Owners of business will use receipts to justify deductions and students receive 1098’s to prove that they have paid tuition expenses.
The last pile needs to be separated further, the first pile needs to be items that have nothing to do with paying your taxes, and the other is the paper pile that you will need to take to your Torrance Tax Preparer.
While there is such a thing as having too many taxes, you can never have enough simple and concise information, insight, and commentary, even with tax professionals at your disposal. Therefore, I present to you the…..
At $15.00 an hour for 40 hours a week, my employee’s gross pay (before taxes) will be $600.00 a week. For simplicity sake, let’s say the employee does not want to pay any money in Federal Income Tax with their weekly paycheck. I have to withhold from my employee’s check $25.20 for Social Security (for calendar year 2011 the Social Security Rate from the employee is 4.2%, the rate is actually 6.2% in any other year) and $8.70 for Medicare Tax. In addition to withholding these amounts, as the employer I am required to match the employee’s Social Security and Medicare that I have withheld. So out of my pocket I must pay $37.20 in Social Security (the Social Security Rate for the employer is unchanged at 6.2%) and $8.70 for Medicare.
Build a team. Affiliate companies can build your credibility, increase referrals and become an extension of your services. Your affiliates should include a mortgage professional, a title company, a home warranty company, a home inspection company, a real estate attorney, etc. Your team should also include businesses that will help you become more accomplished in less time. Your business would benefit from adding a business coach, a tax accountant and a personal/virtual assistant.