Tax time isn’t much fun until you see that strangely beautiful check made out in your name from the federal and/or state treasuries—if you’re even that lucky. Contrary to what we’d like to think, the goal for most people shouldn’t be to get the largest refund check possible but to get very little and pay nothing. A large refund check means that for the past year, Uncle Sam has been hanging onto your money, interest-free. You have to pay interest when you borrow from your bank or from the government, but the government doesn’t owe you any extra for the privilege of using your money over the past year.
To avoid this sinking feeling next year, pay really close attention to your financial statements and tax filings, for your company and for yourself. In keeping with my logical yet attention deficit-like mind, I’ve gone back to TopTenReviews.com for their straight-forward charting of the top—eh hem—nine tax filing software programs for 2011. There is a wide range in price, but the first three softwares (TurboTax, H&R Block and TaxACT) all come with maxed out ratings. During this time of year, tax softwares are on sale almost everywhere. Check out places like Office Depot and Costco for some solid savings. Virtually all tax programs have some kind of “home & business” edition, as well as e-filing features to make submitting your forms quick and easy.
Tax deduction finders are fairly common and certainly recommended (TurboTax, H&R Block and TaxACT all find tax deductions), but don’t forget to do some of your own research! The U.S. Small Business Administration has a page chock full of information about tax deductions for small businesses. Among seven examples of the “top tax deductions for your small business,” provided by Nolo, is bad debt; if a customer doesn’t pay for a product you ‘sold’ them, the cost can be deducted, but if a client hasn’t paid for a service, the work isn’t deductible. Ouch.
Government-run websites are going to be your best sources of information, so you’ll probably want to check out the Small Business and Self-Employed Tax Center from the IRS. It covers virtually ev-er-y-thing you need to complete your business tax filing. Want some more information and not sure how to find it? Post your question in the comments section and we’ll surely find an answer!
