Proper tax planning is a very important responsibility that all people share. While tax planning is important for consumers, it can be even more important for small businesses. Due to the potential cost of income taxes, hiring a professional for tax planning could be a great option for all small business owners. There are several reasons why a small business should hire an accountant to help with tax planning and preparation.
Reduce Tax Liability
One of the advantages of hiring a tax professional for tax planning and preparation is that they can help to reduce your tax liability. There are a wide variety of tax deductions and credit available to small business owners. A tax professional will be able to help you to identify all of those that you already qualify for as well as what strategies could be followed to qualify for additional credits and deductions. This could help to reduce your net taxable income, tax rate, and ultimate annual tax bill.
Control When Taxes Will be Paid
An advantage of hiring a tax planning professional you will be able to better control when taxes will be paid. If the revenue of your organization is lumpy, you have large capital gains, determining when revenue will be recognized and when taxes will be paid is very important. Tax planning professionals will help you build a long-term plan. You should recognize revenue and make certain business decisions.
A small business CPA can also help you to prepare your taxes. This will include providing all necessary information and forms to the IRS. If audited, the CPA will be able to provide you with additional support.