Planning and creating a strategy for taxes is vital for small businesses. Tax rules and requirements can be complicated, so trusting an expert with your tax planning and preparation can save you time and money.
What Is Tax Planning?
Tax planning is a crucial proponent of thinking about and implementing strategies to minimize your tax bill that lead to your business’s success. Doing this ahead of time, before taxes are due, can help you reduce the amount of taxes you will owe. Tax planning services are essential for small businesses as the US tax code can be seen as complex. Having tax planning services can save money by maximizing their deductions.
Why is Tax Planning Important?
Our tax planning services help our clients save money on their taxes to reinvest that money into their businesses. Many small business owners miss deduction opportunities and need to pay more in taxes than they need to. Good tax planning can help them avoid this.
Small Business Tax Planning
There are several different sizes and structures of small businesses. We have experience creating the best tax plan for all of them. Your business’s success matters, so let us help.
Sole Proprietorship
A sole proprietorship, or self-employed individual, is a setup when the business owner and the business are the same legal entity. Sole proprietors should focus on minimizing their self-employment tax burden. They can do this by making the most of their business losses.
General Partnerships
In a partnership, the business and the owners are also legally the same. The assets and liabilities to the companies are shared between the partners depending on the percentage they own. Partnerships can be a good structure for tax purposes, but multiple types of taxes are involved, so planning is essential.
S-Corporations
S-Corporations are “pass-through” entities legally separate from their owners, bypassing double taxation. This makes them an excellent structure for tax purposes. S-Corporations profits fall to shareholders and are reported on Form 1040. While the S-Corporation owners must pay themselves “reasonable compensation,” they are not required to pay SECA tax on their profits.
C-Corporations
C corps can be a good choice in some situations, but they are subject to taxes on the business income and the owner’s dividends. It gets its name from subchapter C of the Internal Revenue Code. The corporation must pay corporate income tax with Form 1120. Shareholders then pay taxes on their income. There is no restriction on their shares or the number of shareholders, so anyone anywhere can have ownership.
Non-profit Entities
Unlike other corporations, non-profit entities do not have shareholders but instead have a board of directors. To gain non-profit status, they must complete Form 1023. If the business qualifies for non-profit status, they receive a tax-exempt certification. Non-profits do not need to pay federal taxes, but they do need to file tax returns. Failure to file tax returns for three consecutive years results in a loss of exemption.
Our Small Business Tax Planning Process
Our tax planning services are structured with a five-step process.
- Meet with a tax planner.
We begin our CPA tax planning process with a consultation. Our experts will look over your business’s financial situation and put together an initial tax strategy for you. The tax strategy will be based on our assessment and will develop as the process continues.
- Send us your tax forms and documents.
After our initial consultation, you will send us your previous year’s tax returns and other documents such as financial statements so we can factor this information into your tax plan.
- We prepare your tax plan.
Our experts will review your documents and tax forms to put together a plan that considers excise taxes in compliance with tax laws.
- We complete an additional review.
We take another look at your overall tax situation to identify additional opportunities for savings.
- Review your plan with your advisor.
Our well-trained tax planners will go over the tax plan with you and answer any questions. We will point out and explain all the excise taxes and the solutions you can take for prevention in the future.
GO Admin Solutions Are Your Formal Tax Planning & Analysis Experts
Trusting a tax planning expert with your tax planning and preparation can save you time and money to put back into growing your business. GO Admin Solutions has the small business tax expertise you need to minimize your tax bill. Contact GO Admin Solutions to discuss how we can help you and your business today.
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