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Almost every small business owner initially handles every aspect of their company, from planning marketing campaigns to stocking shelves. While you may be able to take care of your tax prep in the beginning, at some point your business will likely outgrow your ability to prepare and file accurate returns, causing you to miss out on valuable deductions and make potentially costly mistakes. 

When It’s Time to Hire a Tax Prep Professional

1. You Have Employees

Businesses with full-time employees must withhold income, Social Security, and Medicare taxes, and offering employee benefits complicates the situation further. Even honest mistakes when calculating payroll taxes can leave your employees with major liabilities at the end of the year, so it’s important to consult with a professional.

2. You Trade Internationally

Working internationally means navigating a complex set of challenges with which most owners have little experience. How you structure your business and where the profits go can impact your tax exposure, so find a CPA with specific expertise in this area.

3. Your Income Is High

tax prepOnce you pass the $200,000 threshold, your chances of having an IRS audit increase dramatically. Those who make $1 million per year or more receive even greater scrutiny, so having a professional who can explain your returns provides valuable peace of mind.

4. You Become Confused

As your business grows, you may not know how to claim new expenses or whether you qualify for certain deductions. Tax prep professionals have the detailed understanding of the code necessary to organize your purchases and ensure you receive every deduction you deserve.

5. You Make Major Changes

Personal life events like the birth of a child as well as major business investments can have a dramatic impact on your overall tax exposure. If you’re planning on expanding or experience a significant increase in revenue, your CPA will help minimize your liabilities while staying compliant with the code.

6. You Don’t Have the Time

The more complex your business becomes, the more time-consuming and confusing your tax preparation will be. Putting off your taxes or running out of time can result in missed deductions and late-filing penalties.

7. You’re Expanding Into New Markets

Opening a location in another state may allow you access to new customers and streamline operations, but it also makes you subject to local tax codes with which you may not be familiar. A local account ensures you remain compliant with your new market’s reporting and filing requirements.

 

The business accountants at JJR & Associates LLC are committed to providing companies throughout Greater Atlanta Area, GA, with high-quality tax prep services and expert financial advice. Visit their website for a complete list of their services, call (404) 437-7748 to make an appointment, and follow their Facebook for more updates from the professionals.

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