There is a very timely post over on Financial Think that we probably all need to read, and then read again. It’s about tax preparation and how not to leave money on the table by properly
preparing for end of year taxes. David Stern rightfully points out that entrepreneurs are one group that under utilize CPAs, and ironically enough, they’re probably the ones that probably need help the most. It’s no secret that small business owners have a DIY mentality and that very mentality is probably what makes them great small business owners. It allows them to do more with less. In the case of taxes, however the consequences can be huge if the job is not done correctly. Leaving money on the table is better than having to pay fines, but neither is desirable.
David’s other points are pretty straightforward:
- “Just do it.” Contact your CPA now and setup an appointment to get the ball rolling. With a little preparation, your accounting reports or box full of invoices and bills is really all you need.
- Look broadly at your tax situation — include both personal as well as business in your planning exercises.
- Look broadly at time. Don’t minimize your tax this year only to have to pay through the nose next year. Figure out ways to normalize your tax burden across multiple years.
In short, don’t be afraid to hire out tasks such as tax planning. Despite trying to be a jack of all trades, ask yourself if tax planning is really where you want to spend your time. Most small business owners I’ve interacted with would rather just run their businesses.
(Photo courtesy of HeyPaul)