Recently, Tax Defense Network‘s business tax team leader, Jessie Seaman was featured in an article on American Express’ OPEN, a resource on AmericanExpress.com for business owners to discover insights, make connections and get exposure to help grow their business. Jessie was able to share some of her insight into small business tax issues to help small business owners avoid common tax missteps.
As well as being a Senior Associate Licensed Tax Professional at Tax Defense Network, Jessie Seaman is an Associate Faculty Member teaching Business Law for the Business Master’s Program at University of Phoenix. Her tax advice is frequently featured on the company’s LinkedIn profile.
Jessie’s first advice to small business owners was to make sure to know and understand all their tax responsibilities. New business owners are often stunned by the different types of taxes they are required to pay: federal, state, local, sales, property, payroll, self-employment taxes, the list goes on, particularly if the business has employees.
Jessie Seaman elaborates, “In addition to IRS taxing requirements like unemployment, each state, county, locality and district has its own filing and paying requirements,” Seaman told AmericanExpress.com. “In just one year, a small business with three employees could end up with more than 10 to 30 tax returns that need to be filed with federal and state revenue agencies.”
These tax returns can be complicated and many times when small business owners without a background in tax take on tax preparation, errors can occur. These errors can cost hundreds or even thousands of dollars in penalties.
Jessie also advises small business owners to outsource their payroll. Payroll taxes are complex and the IRS is particularly severe when penalizing companies for late or improperly filed payroll taxes.
“It doesn’t take long for a new business to go belly up because payroll taxes were not properly paid. Even if you choose a corporate structure or LLC for the personal liability protection, this is not a blanket safety net; the IRS can hold officers liable for nonpayment of payroll taxes. Hire a payroll company. The fee is nominal for the benefit, and they are experts.”
Jessie’s final advice was to keep detailed and up-to-date financial records, not just to make filing taxes easier and less stressful, but also to help monitor the progress of your business.
Tax Defense Network is a national tax debt relief company that helps individuals and small businesses find solutions to their IRS and State tax debt problems. Its staff of licensed tax professionals, CPAs and enrolled agents have resolved over $120 million in client tax debt. The company’s twitter account is an excellent source of tax advice and information.