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Tax

Your 2023 Small Business Tax Preparation Checklist

By December 13, 2021 No Comments

By this time of year, you’re not even thinking about 2022 anymore. Most of you are probably thinking about what 2023 brings (that’s how growing businesses work, right?)

But when it comes to taxes, it’s always going to feel like having one foot in a room where you’ve already closed the door. Who can keep up with that? We hear you! 

That’s why we’ve made a small business tax preparation checklist for you (with a few pro-tips thrown in) to make sure you’re not solely focused on paying your taxes from last year but on the growth ahead, too.

Ready to get started? Keep on scrolling!

Step 1: Add Tax Deadlines to Your Calendar

There are a few different tax deadlines that you need to keep in mind. Take a look at these dates, and jot down any that are relevant to your business’s tax needs.

For reference, the quarterly tax payments apply to those who are self-employed or receive a form of income that requires you to pay quarterly estimated taxes.

P.S. We have a free small business tax calculator to help you with your quarterly estimated tax payments!

Step 2: Figure Out Which Tax Form You Need

Different business types need different tax forms. See our visual below. 

small business tax checklist

Step 3: Consider a Tax Extension

Tax extensions aren’t for everyone, but it may pay off depending on your unique situation.

You may benefit from a tax extension if:

–       You don’t have all your documents and information ready

–       Your small business return has not been completed yet

–       Upcoming retirement funds could be deducted from 2021 taxes

Whether you extend your return or not, your tax payment is due to the IRS by April 15. So, why consider an extension? If you’re late without an extension, you’ll owe the full payment, in addition to interest. However, if you choose to extend, you can avoid penalties and interest rates.

Step 4: Pick Your Tax Services

Taxes can feel overwhelming, but you don’t have to do it alone! Acuity offers plenty of resources to simplify your to-do list and set your small business up for success.  Plus, we partner with the best small business tax software companies out there. 

Cleanup

Even if you’re not as organized as you’d like to be, you can still make the most of your tax return. We’re here to help you with bookkeeping cleanup. That way, you don’t have to worry about details from your invoices or statements getting lost in the shuffle.

Tactical Bookkeeping Support

Taxes don’t have to be complicated. We’re here to show you how to make them as simple as possible for busy business owners like you.

Let our team work behind the scenes to ensure you’re ahead of the game. While you’re working, we’ll put together financial reports and up-to-date, tax-ready books. We work proactively to prepare taxes without involving business owners — so you can enjoy a simple (and paperless) experience!

Compliance

It can be difficult to keep up with any new tax laws for small businesses. We’re here to keep you informed and help you stay compliant.

Our bookkeeping services and our tax services are connected, so you can be sure that everything is running smoothly. Pairing these services improves tax estimates and implements tax planning strategies to ensure they flow through your personal tax return, maximizing your tax savings.

Analysis

Work with an expert so that you’re ready for success. Our dedicated controllers are here to help you build accurate budgets, streamline workflow processes, and address complex accounting issues, such as deferred revenue and GAAP-based accounting.  

Strategy

Our chief financial officers are experienced leaders who know how to manage mergers, acquisitions, funding challenges, and more. By working with an Acuity CFO, you can have the confidence that you’re making sound decisions for your business’s future.

Step 5: Use Your Tax Return Wisely

Choosing the right services for your business saves you time, money, and energy – things that are much better focused on your passions. We offer a handful of options, ranging from quarterly to daily services. Every business is different, so take a moment to see what’s best for you.

2023 Small Business Tax Preparation Checklist FAQs

How much money does a small business have to make to file taxes?

What we’re looking for as your tax accountants is whether your small business brought in at least $400 of gross revenue (AKA income before expenses). If that’s the case for you, then you are required to file a tax return with the IRS. Now, if you earned less than $400 in your small business, it is still a good idea to file a tax return, anyway. For example, one of the perks of doing so is that you can claim expenses related to operating your business.

What are tax requirements for a small business?

You are required to pay your taxes and file an annual tax return showing your business revenues and related expenses. Additionally, depending on where your business is located, you might have to collect sales tax from your customers based on the products or services you sell. Also, as your small business grows, your tax requirements will change. 

As your accountants, Acuity can accompany you on your growth journey. Together, we can figure out exactly what tax requirements apply to your business.

What do I need to give my small business tax preparer?

Small businesses should be giving their tax preparer a summary of all income and expenses related to their business. You should also give them any tax forms you receive in January and February, such as 1099 form, 1095 form, W2, and any tax other documents you receive. 

Some tax preparers will also give you a checklist or a questionnaire or some type of organizer. This will provide a detailed list of all the documents and data that is needed for tax preparation.

What tax form do I need for my small business?

The specific tax forms you need depend on how your business is set up. For example, if your business is structured as a sole proprietorship, then your small business will need to file the schedule C, which is included with your federal 1040 personal return. Partnerships file a federal form 1065. Corporations file either federal form 1120 or 1120S.

How can small businesses lower their taxes?

This is a big question that we get frequently — because who doesn’t want lower taxes, right? There are a wide variety of techniques that we can use to lower taxes for small business owners. The most common technique is to manage expenses so that bottom line net profit and the corresponding tax impact are manageable. 

Many businesses need to invest in equipment fixtures, computers, software, and other types of assets. So small business owners can decide to deduct the full cost of some of these expenses right away, or they can spread the cost of these assets over several years, deducting all at once results in immediate tax savings this year. On the other hand, spreading out the deduction over multiple years can be more advantageous. If revenue is going up and we need you to reduce taxes in future years, we can also claim tax credits specific to small businesses, such as the new tax credit for paid sick and family leave.

As your accountants, Acuity works closely with you to help you make smart choices to lower your small business’ taxes as always. Let’s get started today!

What’s next?

We hope that our small business tax preparation checklist helped answer most of your questions. If you have additional questions, submit them below and schedule time to talk to our team! We’re always here to help.

Also, don’t forget to check out our recent blog posts – Free Quarterly Tax Payment Calculator and 2022 Tax Deadlines And Dates: What Business Owners Need To Know When Filing This Year.