Keep The IRS Out Of Your Life By Avoiding A Tax Audit. If You Live In Idaho Falls, We Can Help!

The proverbial IRS taxman is the last person you want darkening your doorway. The IRS has reported that 1 in 200 taxpayers has a chance of being audited every year. Keep yourself or your business out of those statistics-here are some tips!

Ways You Can Avoid A Tax Audit

Luckily, there are ways you can reduce your chances of being audited. Here are a few to be aware of:

• Make sure you computations and figures are correct
• Keep receipts and get appraisals for all charitable contributions of $250 or more
• Fill out tax forms completely and carefully and leave nothing blank
• Keep copies of your returns for several years
• E-file if possible

Let’s discuss these a bit more. You want your numbers to be right. The IRS uses computers to cross check your returns with any other information that it has for you, from banks, employers, etc. So be sure you have accounted for everything and that your numbers match. Otherwise you could be flagged for an audit.

Charitable contributions can change from year to year, and if your tax return is noticeably different from last years, the IRS will want to know why. Save all of your contribution receipts. You should also include an explanation (in the form of canceled checks, receipts, etc).

Be sure to fill out tax forms completely and leave nothing blank. Don’t leave anything for the IRS to assume or wonder about. The computers will flag any discrepancies in math. You want to draw little or no attention to your return, so if it sails smoothly past the computers and the agents, that’s a good thing.

Be sure to keep copies of several years returns. The IRS can audit you from 3-7 years back for discrepancies. Be sure you are able to defend yourself by keeping your returns.

E-file if you can. The error rate for a paper return is 21% and the rate for e-filing is 0.5%. Less errors equal less flagging and attention from the IRS. The accountants and tax preparers at Poston, Denney & Killpack PLLC in Idaho Falls are familiar with these and other ways to avoid a tax audit. They can help you prepare your taxes, tax planning, and also helping you with any problems you may encounter with the IRS should you be audited. They are located In Idaho Falls and if you are trying to avoid or facing a tax audit, Poston, Denney & Killpack PLLC would love to help you maneuver through it! They are affordable, experienced and ready to help you this tax season avoid those IRS agents and their audits. In Idaho Falls call us at (208) 522-0886.

Common Tax Mistakes Small Business Can Make

Running your small business is rewarding in many ways but navigating all of the taxes for a small business can take the reward right out of it. There are too many things that can be forgotten, unknown, or mistaken- a wrong deduction here, a missed credit there, and suddenly that little mistake is drowning your business. Here are a few of these common tax mistakes small business can make, be sure they aren’t yours!

Tax Authorities You May Owe

Many small businesses have no idea how many authorities they should be paying taxes to. In addition to the federal and state income taxes, here are some other taxes you may owe:

• sales taxes
• property taxes
• payroll taxes
• local and municipality taxes
• excise taxes
• self-employment taxes

Take some time and educate yourself about which taxes you may need to pay. A good accounting firm can help you sort through who and what you may or may not owe! In Idaho Falls, Poston, Denney, & Killpack, PLLC will be glad to help you determine who these are, how to file, and if need be, how to pay them.

Ignoring Self Employment Taxes

Don’t assume you don’t have to pay this tax! If you net more than $400 from your business, most of that money will probably be subject to this tax. Penalties and interest can add up quick if you neglect this tax. Paying it quarterly will avoid a big payout at end of year tax filing.

Doing Your Own Payroll

You may think you are saving money by doing in-house payroll, but this can be a very costly common tax mistake. Not only is it time consuming and complicated, but it is also a common way to defraud employers through payroll checks and tax returns, not to mention filing mistakes and improper payments. To avoid penalties, just outsource this job.

Missed tax credits

Another common tax mistake is to miss tax credits. There are a lot out there, and since running your business will take up enough of your time, you don’t need to also be sifting through all of the current tax laws looking for these. Some you may be missing:

• Small business Healthcare tax credits
• Tipped employee payroll tax credit
• Domestic production activities deductions
• Tax credits for hiring disabled workers
• Returning Heroes tax credits for hiring veterans

These are just a few of many. Hiring an accounting firm is your best bet to help ferret out these credits, it’s their job to know!

These common tax mistakes can be fixed of course, by re-filing amended forms when you get an IRS notice, or by hiring your own oversight department, but those solutions are time consuming, and too costly or not feasible for most small businesses to do on their own. A better idea is to hire an accounting firm to do your taxes, correct mistakes, and keep them from happening again. Poston, Denney, & Killpack, PLLC can help you with all your small business tax concerns, and that peace of mind is it’s own reward.

Worrying about the headache of end of the year tax filing? Stop, because Poston, Denney, and Killpack, P.L.L.C. will guide you safely through treacherous paperwork!

If you have a small business, you may or may not realize that January 15th is a big day. It is the day that your quarterly estimated taxes are due. Not currently filing taxes quarterly, but wondering if you should? Here is some important information to know. Quarterly estimated taxes are for the self-employed or those will receive large windfalls.
When filing quarterly taxes, it is essential to keep a careful schedule! The important dates are:

• For income received January 1st through March 31st, your estimate is due April 15th.
• For income received April 1st through May 31st, your estimate is due June 15th.
• For income received June 1st through August 31st, your estimate is due September 15th.
• For income received September 1st through December 31st, you estimate is due January 15th.

When dealing with end of the year tax filing, it is important to separate fact from fiction!

We have compiled a list of major misconceptions to clear the air!

• For quarterly taxes, you can just pay one lump sum at the end of the year. False! You can and should pay the amount due in payments during the year.
• If you don’t make much, you don’t need to file. False! If you made or received payments, you likely need to file an information return with the IRS.
• If you miss a payment, you should just wait until the next payment. False! You should make the payment as soon as you can to reduce penalties.

Contact Poston, Denney, and Killpack, P.L.L. C. today and see the miracles we can work for you!

When dealing with end of the year tax filing, the most important thing is getting it done right. You don’t want to find yourself bogged down for the next year and beyond by penalties and interest that could be avoided. Save yourself the headache of mistakes and the ensuing confusion by contacting us today. We will get and keep you on the right track!

The Payroll Nightmare

Small business owners in Idaho Falls are finding it increasingly difficult and time-consuming to keep up with all the laws and statutes governing their company’s payroll. No one likes having to spend several hours every month just figuring out payroll. The average business owner spends 8 hours every month doing payroll. So for 12 full work days a year, business owners have to deal with payroll instead of running their business. Those are 12 days that can’t be used for generating more business, improving products or services, or helping customers. On top of the time consumption, there’s always the fear that there’s some new law that you don’t know about, or the general fear that you might do something wrong—and either mistake could result in large costs.

Beating the Nightmare

Of course, the most obvious solution to these concerns is to hire someone else to do it. You could increase your overhead and hire someone on to your team to do all the payroll tasks, or you could hire an accounting firm to do it for you. The latter is generally more affordable in Idaho Falls, and payroll services come with several advantages when they’re outsourced: it’s cost effective to have an accounting firm handle your payroll and the associated legal details, and it reduces the overhead of hiring a specialized employee. It saves you heaps of time that you can better spend running your company, and you can safely stop worrying about data entry or researching updates or new laws. Your tax filing becomes effortless when you let a professional do it. They can keep track of all the federal, state, and local payroll tax laws and apply them for you. These laws change frequently, and keeping up with them alone can be a daunting task. An accounting firm will generate a wide variety of reports like union reports, certified payroll, workers’ compensation, etc. and provide them for a nominal fee.

One Size Doesn’t Fit All

A good accounting firm will provide several options for varying levels of their services. Usually these include anything from comprehensive services, where you get pretty much every payroll service possible, to minimal services where only checks, taxes, and reports are generated for you to print yourself. These are the services you should look for in a CPA in Idaho Falls. Payroll services should be flexible and allow for customization, because no two businesses are the same.

Tax Extensions

Preparing and filing tax returns is never fun, but paying your federal income taxes to the IRS can be stressful and even financially challenging in some cases. While the April 15th tax filing deadline is a date that may be etched into your mind, the fact is that you can request an extension of time to file if necessary, and a skilled and experienced CPA can assist you with filing the proper paperwork with the IRS.

Extensions may be filed for personal returns or business returns. In many--if not most--cases, an extension may be necessary due to business related issues. Maybe you are waiting on a piece of information from another entity, preventing you from being able to file your tax return. If filing a tax extension for your individual income tax return, you would need to fill out form 4868. If you are filing an extension for a corporation, partnership, REMIC, or certain types of trusts, you would need to fill out form 7004.

When you request an extension of time to file with the IRS, you should be aware that this is a short-term extension. The request for an extension must be paid by the tax filing deadline, and a second extension may be granted by the IRS in some cases. This essentially provides you with more time to gather together your tax documents for your Idaho Falls tax preparation in order to have your accountant prepare the taxes and more. There are times when the days simply fly by, and the filing date may have approached more quickly than you realized. In other cases, major life events like the loss of a job, a divorce, or other circumstances may have consumed all of your attention.

Some individuals who need additional time to pay taxes may believe that an extension of time to file is an extension of time to pay taxes, but this is not the case. If you owe taxes to the IRS and you request an extension to file, you will be responsible for interest owed on the amount due. If you are able to file now and need extra time to pay, you can speak with your CPA about other options. For example, you can request a payment plan through the IRS. This way, you can begin making regular payments to the IRS, and this may decrease the total amount of interest that you pay on your tax bill.

There are many reasons why you may not be ready or able to file your tax return by the tax deadline. When you speak with your CPA about your circumstances, you can learn more about the options available to you to file and pay your taxes.

Self-employment Tax and Quarterly Tax Payments

Being self-employed definitely has its perks. No one is giving you orders, and you get to pick your own projects and hours. Despite the fact that a boss is no longer breathing down your neck, you can’t escape IRS tax requirements. If you own a small business and want to avoid being penalized for missing a tax payment, consider this information about self-employment tax obligations.

Self-employment Tax

According to the official IRS website, self-employed means you are the sole proprietor, independent contractor, or a member of a partnership with a business or trade. If you fall into one of these categories, you have certain tax obligations that you should be aware of. As a general rule, self-employed individuals file an annual return as well as pay estimated taxes quarterly. This includes self-employment tax, which, according to the IRS, is a “Social Security and Medicare tax primarily for individuals who work for themselves.” Note that this is a separate requirement from income tax.

Estimated Tax Paid Quarterly

To take care of your self-employment tax, you will most likely be asked to pay an estimated tax four times a year. Estimated tax is exactly what it sounds like. You simply use last year’s return and the 1040-ES form to approximate the amount you owe each quarter. In short, four times a year, you are required to pay taxes on a quarter of your return from the previous year. If you discover that your estimate is too high or too low, don’t worry. Just fill out a 1040-ES worksheet to correctly recalculate your estimated tax, and you will get a refund or pay the difference.

Don’t miss the deadline for your quarterly taxes. The IRS does not take kindly to late payments, and you will be penalized for missing your deadline.

Paying taxes quarterly can be a pain, but once you learn the rules and stick to the schedule, it is much less of a hassle. If you are struggling with understanding every tax hill you have to climb, you might want to consult a company that specializes in these types of services. Whether you live in Chicago or Idaho Falls, small business financial services companies can help you during stressful tax times.

Idaho Falls Small Business Financial Planning

Poston Denney & Killpack, PLLC is the company to go to when you need assistance with Idaho Falls small business financial planning. One of the most important elements of having a successful business is having a sound financial plan for the business.

Our certified public accountants can help you develop the best financial plan for your small business. Our CPAs have the knowledge and skills necessary to provide you with the expertise that you are looking for in tax professionals.

In addition to offering Idaho Falls small business financial planning, we also offer strategic business planning, succession planning, business valuation and various other small business services. No matter what type of assistance your small business requires, we can deliver the service that you need.

Our Idaho Falls small business financial planning is designed to help you keep your small business records organized so that when tax time rolls around you will be more prepared for it. No business owners want the time for filing taxes to come around only to find that their businesses’ records are a disorganized mess.

We try to help you prevent that from happening by helping you develop a financial plan that keeps your business’s finances organized so that they are ready for tax season. Additionally, we help you develop a financial plan that best suits your business’s needs and maximizes profits while minimizing expenses.

Idaho Falls Small Business Taxes

When it comes time to file taxes for your small business, we are more than happy to assist you with your business tax preparation as well. We can help you ensure that you pay everything that you are supposed to pay in accordance with federal, state and local laws while making sure that you don’t pay more than you have to at the same time.

No matter whether you are starting up a new business, trying to expand a current one or trying to turn around a failing one, we can assist you with developing the best financial plan for you business. Contact Poston Denney & Killpack, PLLC for a team of knowledgeable and professional CPAs that can help you maximize your business’s success.