“It’s income tax time again, Americans: time to gather up those receipts, get out those tax forms, sharpen up that pencil, and stab yourself in the aorta.”
It’s that time of year again. Ain’t it fun?!?
Don’t get me wrong. I don’t mind paying my share for our military, roads, law enforcement and other systems we need in place to keep our society stable. There are just three things that bother me about paying taxes:
- The complexity
- The waste
- All of us become liars – some in order to pay less in taxes and some accidentally because of reason #1.
So what does that mean for your business?
Know what you are getting into. Find resources that help you make your business grow in spite of your tax burden. Use a group of professionals that can help you steer through it.
Make sure your professional is the right one. I just sat with a client this week that is very worried about how much he will owe in taxes. He has switched CPAs because he felt he had outgrown his previous CPA. Now it looks like he may have more tax liability than he planned because of poor advise and because he failed to do the next hint:
Prepare ahead of time. Make sure you are have a sales tax account if you are collecting sales tax. Make accommodations for your employee’s employment taxes and your own self-employment taxes. This is sacred cash and should never be disturbed until you have paid all taxes. It’s better to have a little too much in the account at the end that you can re-invest than to be stuck with a bill your business can’t bear.
Create a system and be organized. Unfortunately many of us have trouble keeping a mileage log, filing receipts, balancing our books regularly and keeping up with our tax commitments throughout the year: quarterly state taxes, estimated self-employment taxes, sales tax reports, unemployment and workers compensation. If you create a system to make them happen, it makes it easier to stay out of hot water.
Finally, get involved. Let your local, state and federal officials know how you feel. Become part of groups that influence how taxing decisions are made: professional organizations, business lobbyist organizations, and chambers of commerce allow you to amplify your voice.
At the end of it all: the only sure things in life are death and taxes. Be prepared for both.
(January 30, 11:30 -1:00 – Poulsbo Chamber of Commerce)
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