How to Handle Your First Business Tax Return

You will always remember 2017 as the year you started your own business. But now tax time has arrived. It’s your responsibility to get those returns filed accurately, timely, and in a way that achieves the maximum refund possible. Of course, you also have a business to run at the same time. Here are a handful of things to consider when filing a business tax return for the first time:

  1. Review the forms in totality – It’s important to do your due diligence in seeing which line items need to be filled out. You will be asked things such as the nature of your business, the year of the business, and of course, its location. Lastly, be sure that your accounts have the correct categories of expenses and income. This will allow you to get off on the right foot in terms of filing those returns properly.

  2. Determine the right depreciation method – As explained by The Balance, the Internal Revenue Service allows a first-year deduction of up to $100,000 for the majority of furniture and equipment, as opposed to writing off the cost over a number of years. It’s your choice, therefore, if you’d like to take the first year write-off. If your business is still relatively young, then it may be best to go with a slower depreciation. This ensures that most of the deductions will be available when your business has more income and is in a higher tax bracket.

  3. Understand home office deductions – Do you have a home-based business? Then it’s important to consider the ability to deduct a portion of your residence as a deduction. To do this right the first time, deduct the percentage of the real estate taxes and mortgage interest that would be otherwise taken as an itemized deduction. If there are any profits remaining, then other home expenses would be allocated to the business and personal portion.

  4. Calculate self-employment tax – Believe it or not, self-employment tax may be a significant part of this process. Make it a point to calculate these taxes as part of your total when paying quarterly estimates. Not to mention, the first quarter installment of your 2018 taxes are also due April 15. It’s crucial that you have these funds readily available.

  5. Get the necessary forms to employees – Remember that your employees receive a printable W-2 form to identify their income and withholding tax. Then there’s the 1099-MISC reporting for contractors who make at least $600 as of the 2017 tax year. If you haven’t done so already, have your contractors complete form W-9 to give you the required information. The more time you allow yourself and your team to do this, the better. The last thing you want is to wait until the last second to get everyone their tax forms.

An Easier Way to File 1099

It wasn’t too long ago that business owners were forced to buy and fill out lengthy tax forms. At OnlineFileTaxes.com, that’s no longer the case. We are proud to be an IRS-approved e-file provider. What does that mean exactly? Well, 1099 preparation has never been easier. Unlike other clunky online tax services, OnlineFileTaxes.com is designed with you in mind. We understand that you may not have a lot of time to mess around with tax forms. That’s okay! We have made the entry and filing of tax data both convenient and economical. Best of all, we guarantee that your information is filed on time with the IRS.

No longer do you have to dread tax season. At OnlineFileTaxes.com, we’ve perfected the e-filing tax process. The information you provide to us is strictly confidential and only to be used for the purpose of filing 1099 forms.

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Whether you need just one copy of 1099 forms or other tax forms, we have you covered. Sign up for free today and get started with our services for as low as $1.25 per form.

 

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