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5 Signs You Need Small Business Tax Help

 

There are a lot of times when a mom working from home could really use some small business tax help from a CPA, preparer or other professional. There is a reason that so many large and small businesses hire these individuals to prepare their tax filings for them. It takes years of study to become an expert on U.S. state and federal tax codes, and most business owners just don't have the time, the inclination or the resources to do more than educate themselves reasonably about what they may owe.

Here are some situations where the advice of a tax preparer or tax professional can help a small business avoid some pretty serious potential problems.

1. Business Transitions

When a business changes from one form to another, its tax burdens change as well. A beginning work at home mom or other freelancer generally files as a sole proprietor or independent contractor if she has no employees. If the individual choose to become an LLC for liability purposes, they may suddenly realize they need help to decipher their new tax rules.

2. Adding the First Employees

There are some major tax rules that only take place in businesses where the sole proprietor starts to employ others. This is a flash point where many work at home businesses reach out to a dedicated tax preparation office for help.

3. Changes in Business Assets

When a business spends a lot of money on startup costs, its leadership may need help to hedge that cost with tax deductions. Tax professionals can help business leaders to figure out how to depreciate machines or big pieces of equipment in order to get some tax savings.

4. Back Taxes

If the IRS audits a business and claims back taxes based on different interpretations of past filings, that can mean big trouble for the owner of the business. Tax preparers routinely come in to assess the situation and represent a small business owner when the IRS or state department has put liens on assets or bank accounts.

5. Other Trouble Situations

Aside from the above, there are a lot more situations where someone who is guiding their own small business can benefit from taking the extra step to contact a tax preparer or CPA. One of these is when there are unanswered questions about withholding for employees. Another situation that calls for tax assistance is when the business owner has filed for extensions in order to figure out the details of their business filing. One more popular scenario includes confusion about what the business will owe at the end of each year. Having the annual tax bill be a big unpleasant surprise every April is not a good idea. It's better to take steps up front to hire those who will help plan for estimated quarterly filings and keep tax bills in the background, rather than a consistent challenge to profits.

For a work at home mom or other small business individual, it's a good idea to look at the above situations and see if any of them may apply to an existing business setup, where a tax professional can help save a client time and money.

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