Are you a self-employed small business owner in the Metro Atlanta area? Here at NTRC Tax & Finance in Stone Mountain, Georgia, we want you to get the most out of your business each year – this includes getting more from your refund, properly estimating your income, and more. Let’s dive in and take a look at five tax tips and tricks for self-employed small businesses right here in Atlanta.
Self-Employed Tax Tips & Tricks
Tax Tip #1: Time Income & Expenditures Wisely
This might be a little bit convoluted, but stay with us. Timing big purchases can help you out a lot – especially if you find yourself in a new tax bracket this year. You can also time cashing out certain income checks to help even out your income. This is because income is taxed based on when it becomes available to you in your accounts. If you use your timing wisely, you can minimize your tax burden and impact on your overall income.
Tax Tip #2: Try Your Best to Estimate Your Income Properly
Estimated taxes are difficult to get right, and most people end up doing what they think will keep them out of trouble for next year. After all, you only have to pay as much as you did last year in estimated taxes to keep the IRS off your back. However, you might end up with a huge tax burden at the end of the year if you do this.
Instead, estimate how much your business will bring in each quarter and account for growth over last year. Then, don’t forget all of the different types of taxes you need to pay as a self-employed business owner: FICA, federal income taxes, and “self-employment tax” which includes social security and Medicare taxes.
Tax Tip #3: Consider How You File Your Self-Employed Taxes
Unless you really need the benefits of classifying your business as a partnership or corporation for some reason or another, filing as a Schedule C Sole Proprietorship is the easiest way. It’s also the easiest type of business to dissolve or upgrade to other types. We recommend sticking with a Schedule C business type as long as you can.
Tax Tip #4: Get Your Records Under Control
It’s the 2020s, and paper receipts are simply an outdated way to keep track of everything. Regardless of whether or not your business is large enough to warrant the use of tools like QuickBooks, you can still keep track of your expenditures digitally. Doing this means that you’re less likely to miss something or lose a record of what you spent money on this year.
Tax Tip #5: File Your Taxes With the Professionals at NTRC Tax & Finance
Here at NTRC Tax & Finance, we know you work hard keeping your self-employed business up and running. Taxes take a lot of valuable time, and you can’t necessarily stop everything to do them. The tax team here at NTRC is happy to help you file your taxes so that you get the best refund possible – we’ll take care of all of those deductions and credits for you: just send us a list of your expenditures from the past year!
Get in touch with our team to get started on your tax return today!