Those who are busy with the day-to-day responsibilities of running a company may not give their business tax return much thought until tax season has already arrived. However, waiting until the last minute to begin planning can cause you unnecessary stress and make it difficult to minimize IRS obligations. With the year coming to a close in just a few months, this is your last chance to make decisions that can help reduce your tax liability. Here are a few steps to take in the fourth quarter to prepare for successful filing.

How to Get Your Business Ready for Tax Season

1. Get All Books in Order 

If your books aren’t organized and up-to-date, your accountant won’t be able to get a realistic assessment of your business’s finances. Make sure all your accounts are reconciled so you can see if there are any discrepancies in the balances. Having this in order will also ensure you comply with IRS guidelines regarding recordkeeping. 

2. Maximize Deductions 

The IRS offers a variety of deductions that you may be eligible to claim on your business tax return. The end of the year is a convenient time to identify if you’re taking advantage of all the opportunities to lower your tax burden. For example, you may consider purchasing new office equipment and furniture, donating to a qualified charitable organization, taking potential clients out for a meal, or increasing your fourth-quarter advertising budget. 

3. Start Gathering Financial Documents

Most expenses you wish to deduct on your business tax return will need to be substantiated with proper documentation. Start collecting receipts, invoices, bank statements, credit card statements, travel itineraries, and last year’s tax filing to help prove the deductions are work-related. It’s best to have a system in place for keeping these records organized and easily accessible to ensure a smoother tax preparation process. In the event of an audit, you must have this paperwork on hand, as well. 

For small businesses, tax planning should be a year-round effort. Partnering with Joe Heard, CPA will give you access to professional advice and guidance from one of the most trusted accountants in Checotah, OK. Offering more than 15 years of experience, he can help determine the most effective tax-saving strategies for your company and ensure your business tax return is filed accurately. Call (918) 473-1492 to set up an appointment or visit him online to learn more about the tax services he provides.