Any small-business owner knows that tax time can be stressful. Further, you may not fully understand the tax laws. This can leave you worrying about the legal implications if you aren’t in compliance, and make it difficult to focus on running your business.
The good news is, for most small businesses, a tax attorney can advise you on compliance issues and best practices so you can think more about keeping your clients and customers happy and less about Uncle Sam.
One of the biggest challenges for many small employers is keeping up with all the changes related to employment taxes — the money you take out of each employee’s paycheck for taxes, Social Security and more.
Even if you have no major new tax laws to contend with, the government often tweaks and updates current laws, and you could quickly find that you’re out of compliance. In extreme cases, you may even be on the hook for hefty fines if you make a mistake.
Another area where a tax adviser can help is with deductions. Maximizing your deductions and other tax benefits can help you avoid paying more in taxes than you should each year, which means more profit in your pocket.
Recent changes to small-business taxes from the 2018 Tax Cuts and Jobs Act reduced corporate tax rates for many businesses, including larger corporations and smaller entities, and is something that every business owner needs to be aware of.
If reading through the text of that new law doesn’t sound like your idea of fun, that’s where your tax adviser comes in. Tax advisors can make sure you’re not missing out on deductions and other benefits.
Annual Tax Changes
A small-business tax adviser can also help you with the sometimes-annual changes to tax laws that impact your business. For example, the 2017 changes to the tax law removed deductions for business entertaining expenses. If that was a big part of your tax strategy, an adviser can make recommendations on other ways to minimize your tax liability without this deduction.
Or, if you offer benefits to your employees such as health insurance, retirement contributions, and paid leave, these can reduce your liability.
Working with a tax adviser rather than just paying someone to prepare your taxes every year helps ensure you’re using the best strategies to run your small business, from payroll to personal estimated taxes, and you won’t be stuck with a huge bill come tax time. Call the advisers at Cantley Dietrich today to find out how we can help.