Did you recently start a new business? If so, then you absolutely realize by now that starting a new business is an exciting and hectic time. It’s tempting to put other things on hold while you concentrate on getting your business off the ground. However, one issue that shouldn’t be left until later is how you will handle the taxes for your small business.
The tax law offers you some options for organizing your business, accounting for its income and deductions, and writing off your outlays for start-up costs and new equipment purchases. The choices you make can contribute to the success of your business—or put a drag on its bottom line.
For example, one of their first choices you must make is how to organize your business. Depending on your situation, you may have the option of operating as a sole proprietorship, a partnership, a corporation, or a limited liability company. Too often, however, new business owners make this important choice by default. If an individual starts a business and does not make an affirmative choice, the business will be treated as a sole proprietorship for both legal and tax purposes. But is that the right choice for you and your business? It depends.
Other important choices include:
Bear in mind that making the right tax choices is only the beginning. You must be able back up those choices with adequate tax records. Tax questions will inevitably crop up as you organize and run your business. So, it is important to set up a tax record-keeping system and add a Certified Public Accountant (CPA) to your dream team. The right accountant can be a tremendous benefit to your growing business and assist with full-service tax and accounting needs to help you maximize profit and preclude financial headaches.
Wishing you success in your new business venture!
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