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Follow these tips when filing first small-business tax return

Follow these tips when filing first small-business tax return

January 09, 2009|By BOB POOR, Local SCORE education coordinator

Q: Tax season is upon us and our small business needs help in preparing to file our first tax return. Can SCORE provide us with any assistance?

A: Here are a couple of suggestions.

Plan to attend SCORE's fifth annual basic tax seminar Thursday, Jan. 22, from 6:30 to 8:30 p.m. at the Center for Business and Training at Elizabeth Hager Center, 14 N. Potomac St., Suite 200 in Hagerstown. Registration is required by Jan. 19. To register, e-mail info@scorehagerstown.org or call 301-739-2015, ext. 103. Local CPA firm Smith, Elliott, Kearns & Co. LLC will present an educational seminar to assist attendees in understanding and filing their small business 2008 state and federal tax returns. This is a great opportunity to have your questions answered by experts.

Establish an organizational system for your taxes. Include a list of all taxes you are required to file, what information has to be reported and when the tax deadlines are that you need to meet. Missing any tax obligation can be a sure path to possibly closing your business' doors.

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Start by making a complete backup of all current data, and store it in a safe place along with the previous year's records that you are keeping as history. Clean the files and toss unneeded, out-of-date information, keeping a list of what you might want to replace or find additional materials about. Spend some time thinking about what you want to accomplish in the business this year based on what you have learned.

Set up a calendar of vital dates for taxes, payroll, insurance and other fringe benefits. Even without an elaborate computer system, one can organize by placing every receipt that might be deductible in a box or special file. At a regular interval, such as when you reconcile your bank statement, sort the receipts by deductible category and place them in envelopes by category. Should the IRS come knocking at your door, the envelopes are ready to substantiate your deductions.

Begin looking at your tax liability for the reportable year. Make a quick list of the data you will need, what you have, what statements should be coming and what you will need to track down. Once the information is in, looking at alternatives for actual tax computation can be explored. For now, just finding and filing the information accurately is the goal.

The tax information is a good resource for revising the business budget. Often, the easiest way to budget is to look at how money was spent in the previous year and project what changes are anticipated in each of the categories. Remember to tie your budget to the goals for the year.

Happy New Tax Year.

Robert A. "Bob" Poor is a local small-business owner/operator. He is chairman of the local SCORE chapter, a small-business counselor and a regular contributor to the Ask SCORE column. Questions may be e-mailed to him at r.poor@myactv.net or by mail in care of The Herald-Mail, P.O. Box 439, Hagerstown, MD 21741, ATTN: Ask SCORE column.

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