One word that every small business owner despises more than any other is “taxes”. For sole proprietors and owners of LLC’s it means income taxes on profits as well as self-employment taxes. Corporations have the pleasure of payroll taxes, corporate excise taxes as well as income taxes owed should you be a C Corporation.
There have been plenty of songs penned about taxes like The Beatles “Taxman”, or Cheap Trick’s “Taxman, Mr. Thief”, Creedence Clearwater Revival’s “Fortunate Son” or one of my favorites “Take the Money and Run” by Steve Miller Band. These songs discuss share the disgust of having to pay taxes. The reality is no matter what song you sing taxes are still an inevitable part of the small business owner’s life.
So, outside of singing the taxman blues, what can one do?
Proper planning can go a long way to turning your visit to your favorite Accounting office from one of despair into one of relief. Managing your business finances throughout the year enable you and your advisor the ability to make changes that will enable you to save money on your taxes at the end of the year.
Now don’t get me wrong, even the best plans can still lead to owing, but the question is how much?
