Tax Time for Small Business

Just thinking about trying to get all your records together for your CPA or tax guru can be overwhelming. Take a breathe, and use these simple steps.

From your accounting software, run a trial balance.

Look at the income - does it seem in line with your year to date deposits? If not, how old are your accounts receivable? Maybe you should write the old ones off to bad debt.

Look at the expenses - Is Office Exense really high? Take a look to see if there are printers and other high dollar purchases that were classified as expense, but should be assets. You can write off up to $250,000 of equipment and software in 2009.

Get your forms together.

Check the payroll tax returns and make sure your 2009 payroll taxes are paid.
If you paid estimated taxes, organize these.
Find your personal property tax receipts.
Check your accrual accounts to make sure these are in balance and equal what is left to pay. If not, write off or write up the accrued amounts.

Check your asset accounts for items that should be expensed. Small purchases, usually under $500 dollars, can be expensed.
When you look at the items classified as assets, ask yourself if these are used up already. Letterhead, virus software, small printers and toner are good examples of items sometimes classified as assets that are actually expense.

Has your CPA sent you a checklist for your tax return? Take the time now, before the crunch, to review this checklist. It will help you find all the items you need to ensure you receive all the deductions your business is entitled to.