Business taxes can get complicated fast. The United States tax code is millions of pages long, making it next to impossible for a business owner or manager to keep up with all the paperwork they need to fill out. Of course, with changes being made to the tax code nearly every week, there is a very low chance that any person can fill out everything correctly.
Unfortunately, the cost of a mistake can be thousands of dollars. Failing to report income or even making a mistake when reporting the source of that income can result in fines and fees from the IRS. Many businesses have had to learn this lesson the hard way. After making a small mistake, they have spent years trying to pay the debt they owe to the IRS. In some cases, these fines and fees have even forced businesses into bankruptcy.
This is why investing in having your taxes done right is so important. Professional tax preparation has a lot of advantages for any business.
One of the biggest advantages of professional tax preparation is the time it saves. Whether you’re a business owner doing your own tax preparation, or an employee assigned tax preparation as part of their duties, the odds are good that you already know that tax prep is about a lot more than just filling out paperwork.
Taxes are a huge source of “wasted” time for many of our clients. That’s time that they’re not spending on growing their business. Unless you have years of experience in tax work, it can take hundreds of hours to gain the knowledge that a professional tax preparer already has.
For most business owners, this means spending hundreds of hours away from actually growing and running the business. For most business owners, that’s a poor use of resources. Hire someone who already knows the tax code and spend your time doing what you do best.
Of course, the best reason to hire a knowledgeable professional is to save money. Like any job, when tax preparation is done right the first time, it will save you a lot of time and money.
While it is certainly possible for someone to teach themselves how to fill out the paperwork and file taxes for their own business, the odds that it will be done right the first time are pretty low. Everyone can make mistakes, especially people who have never done something before. Of course, a mistake with your taxes can mean paying thousands of dollars in fees and fines to the IRS for years to come.
Even a small mistake can mean overpaying your taxes, and the IRS has no real obligation to error-check your forms. While they have to give you your money back if an error is found, they have no real incentive to look for mistakes that aren’t in their favor. A professional tax preparer can ensure that this year’s taxes are done right and go over your previous years, and file for refunds with the IRS for any mistakes they find.
Even if you already have a bookkeeper on staff, odds are they have no real experience in tax preparation. This is a very specific skill set, and while many of our staff at Nine Line Accounting work very closely with bookkeepers and other accounting staff at businesses all over the country, it is rare that these professionals have the exact skill set needed to file taxes properly. When business owners or managers assume that their bookkeeper can just “figure it out,” they often discover too late that their otherwise very qualified and dedicated staff made an error that has cost their company thousands or even millions of dollars.
Unfortunately, when these errors are discovered, fines and fees may have been racking up for years. If an error is compounded over several years of bad filings until it is caught, the business is on the hook for all of the back taxes owed, plus fines, fees, and interest for all of the years the mistake was made.
Gain Peace of Mind
Let’s be honest; just thinking about the consequences of making a mistake with your taxes is enough to give most business owners anxiety. Nearly everyone has a story about someone who lost their business or livelihood over back taxes or fees.
Even if you think you have a handle on doing your taxes on your own, having a professional take a small amount of time to just look them over can be extremely valuable. Error-checking your work or the work of your staff can be a valuable investment that can prevent costly payouts in the future and buy everyone peace of mind.
When one of our tax preparers can go through your finances and ensure that you comply with tax law, your business can move forward knowing there will be no surprises from the IRS. As the business expands, banks and investors will look for a professional’s stamp or signature on tax documents to know if the information they are looking at is as accurate as possible. Having these documents reviewed and certified means that loans and expansion investments will move forward smoother and quicker.
If you think it’s time to invest in professional tax preparation, visit us at Nine Line Accounting. Our staff has years of experience helping businesses large and small with their tax preparation needs, and we would love to meet with you to discuss how we can help your company.