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Preparing your firm for tax season

Tax season can be the most stressful season all year around for numerous firms—it can be even more stressful if you do not have someone that can take the information and organize it for you. The most vital thing to do for firms this season is to make sure they have all the information layered and organized as soon as the year starts. There are many things that firms and businesses need to look at such as profits and losses that many designers took and especially losses due to the coronavirus pandemic.

Let us get one thing straight, no one is thrilled and excited about the tax season, this is just something that is part of the system—that needs to be done, especially through an accountant, if possible. Regardless, there are a few points that you need to keep in mind during this season, therefore, let us go right into these points which can make your tax season a little bit less hard.

Point no. 1: Gather all the records and documentation and put them in order.

Before you start doing your taxes of your firm, the first thing you need to do is gather all the records as well as the documents of your business and put them in the right order so that you do not worry and get anxious if some papers are missing. Make sure you have all the official papers needed for doing the taxes, even the small pieces are important for this season. If you got a loan during the pandemic, then check if something is deducted or not, gather the papers that are receipts, invoices, expenses, business credit card history, payroll, or anything related to such papers. Using a platform like Avalara can help you stay on top of the tax compliance thought the year, so when tax season hits you are as good as golden!

Point no. 2: Do it as fast as you can and as soon as possible.

You do not want to do the taxes just before the deadline of it, make sure to start as soon as possible, give yourself time or you will be incredibly stressed from all the paperwork, even if you hire an accountant just before the deadline, things can go wrong.

Start your taxes as soon as the year starts also, accountants have other tasks as well, so make sure to hire them when they do not have much tasks to do, usually they are busy just before the deadline of the tax season.

Point no. 3: Get the help of an accountant, hire a professional.

Hiring an accountant can save you time, can reduce all future errors that might occur from doing your taxes all by yourself for your firm. Do not hire just any accountant because you are stressed and out of time, hire one with experience, references, and client reviews. However, finding an accountant to help with this can be a daunting task itself. The accountant needs to understand your type of design firm and be able to manage the finances correctly to prevent any kind of audit from happening.

Designers flock all over trying to find the right accountant or team to be able to handle this in the best way possible. The design CPA wrote an amazing article on how to find the right accountant. 

Point no. 4: Check if you can be audited.

An audit by the IRS can happen any time, especially during the tax season. A normal person won’t know what to look for that could trigger an audit by the IRS. Therefore, hiring a professional accountant that can look at your business’s history as well as your current situation, can tell you if your firm might be audited or not, and what can be done if an audit could happen. Audits are also a huge time consumer and headache if it ever happens. Having all of your documents in place for tax season can mean

Follow all these points to stay clear of any problem or issue during the tax season, hire a professional accountant, and do your taxes properly on time.

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Team indema
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