No one likes paying taxes. In fact, 40 percent of small business owners say taxes and bookkeeping are their least favorite parts of running a business. Cost, time, administrative headaches and compliance rank among the leading reasons entrepreneurs are averse to taxes.
For small businesses, taxes go beyond filing annual income taxes. They also must complete quarterly or monthly filings. Despite the complexity, compliance is mandatory if you want to operate a well-run business. Fortunately, with tax planning apps, you can proactively plan and implement your tax strategy to minimize both your payment and the amount of time involved.
Employee Payroll Tax
Payroll taxes present some of the most imposing challenges for small business owners. They’re one of the most complicated areas of taxes because new federal and state regulations require constant updates and they’re more likely than any other tax to get the IRS’s attention.
The easiest and most cost-efficient way for your well-run business to stay on top of your employee payroll taxes is to use an automated solution that integrates with your accounting software. Gusto automatically calculates and pays your local, state and federal payroll taxes. It takes care of all of your tax filings at no additional charge. Because Gusto works with QuickBooks Online, all your forms and filings can be accessed electronically at any time, from any device.
Different sales tax jurisdictions use different filing schedules — monthly, quarterly or annually. The rise of e-commerce has further complicated sales taxes. Successful companies like Amazon have caused states to impose new tax collection requirements on businesses that vary from one state to another.
Avalara’s AvaTax app helps simplify the sales tax process. When you connect AvaTax to QuickBooks Online, the app automatically calculates sales tax based on your customer’s address and applies it to your invoice. AvaTax prepares and submits all your sales tax forms and your payments to each taxing authority. This ensures that your taxes are paid on time so you don’t receive late penalties.
1099 and W-2 Forms
In the wake of the Affordable Care Act, employers face stiffer penalties for misclassifying employees. Employers face liability for FICA taxes, Medicare taxes, compensation that should have been withheld, state and federal unemployment taxes, and other state and local taxes, including penalties and interest. Beyond the risk of misclassification, simply keeping track of W-2 and 1099 forms and filing them in a timely manner can be challenging.
The eFile4Biz app makes it easier for you to keep up with your 1099 and W-2 obligations. The app automatically prepares, files and delivers your forms. Whether you’re working with one employee or thousands, filing your W-2s and 1099-MISC forms is as simple as importing your data from QuickBooks. The app files your forms directly with the IRS or SSA, and it takes care of printing and mailing the forms to recipients as well.
Small Business Tax Planning
Do you know how much your business owes in taxes at any given time? Tax planning is a complicated but necessary task to minimize your tax liability through the best use of deductions, exclusions and exemptions. Tax Planner Pro helps with this whole process with a simple interface, easy-to-use guides and professional guidance to walk you through strategies and tax-saving tips. The interface shows exactly what you owe and when. It also shows how your tax return obligations will change depending on how your business performs, so you won’t get hit with any surprises.
The app’s tax strategy engine analyzes your current financial position using data from your QuickBooks account and prepares a customized tax plan for you. It’s been programmed with every IRS code and Tax Court case and applies that information to keep your taxes in compliance with current regulations.
When you use tax preparation software instead of trying to prepare your returns by hand, you’ll find that it is easier to stay in compliance and out of trouble. You’ll know exactly what you owe in real-time, and you’ll be armed with strategies to reduce your taxes and minimize your liabilities and bills.