Fear not, tax season is not among us – yet – but wouldn’t you rather be armed with the knowledge and preparation to tackle it head-on come January? Taking your time and preparing as early as possible can save you a ton of headache and alleviate that rushed feeling to submit your taxes by April 15th. Less room for error, bigger refund on your end. Let’s get into it!
Running a small business comes with a myriad of responsibilities, and managing taxes is certainly one of them. Navigating the intricate world of tax regulations can be a challenging task for many business owners, and mistakes in this realm can have significant consequences. Common tax mistakes made by small businesses include inaccurate recordkeeping, misclassifying workers, overlooking tax deductions and credits, failure to separate personal and business expenses, and missing deadlines and filing errors. Poor recordkeeping can lead to incorrect reporting and potential IRS audits, while misclassifying workers can result in penalties and legal disputes. Small businesses often miss out on valuable deductions and credits by not staying informed about available tax breaks. Blurring the lines between personal and business expenses raises red flags and creates confusion during tax audits. Missing deadlines and making filing errors can lead to penalties and interest charges.
At Brock CPA, we believe in supporting our team members, helping them develop their expertise, and achieving their professional goals. To that end, we would like to congratulate Senior Staff Accountant, Tatiana Tonu for recently passing her CPA Exam and recently being officially licensed by the state of Florida!
Understanding sales tax requirements is essential for e-commerce businesses operating in Florida. A little less than two years ago, the State of Florida began requiring e-commerce sellers to collect sales tax, following many years of not doing so.
Today, e-commerce businesses must register with the Florida Department of Revenue, collect and remit sales tax, and file sales tax returns. They must also determine the correct sales tax rate for each transaction and comply with sales tax exemptions and deductions. Failure to comply with sales tax requirements can result in penalties, fines, and audits. By understanding and complying with sales tax requirements, e-commerce companies can avoid business disruption, lost profit and headaches.
For those operating an e-commerce business, here’s a helpful guide to understanding your sales tax requirements in Florida.
It is with great excitement to inform you that Brock CPA will be relocating to the following address in July!
501 Riverside Avenue, Suite 503, Jacksonville, FL 32202
Remote work has been steadily increasing in popularity, and the COVID-19 pandemic has only accelerated this trend. As a result, small businesses are facing new tax challenges. One significant challenge is the question of nexus, which refers to the connection between a business and a state that allows the state to impose tax obligations on the business. With remote work, employees may be working from different states, potentially creating nexus in those states.
Additionally, small businesses may face challenges with employment taxes for remote workers, as employers are required to withhold state and local taxes from employee paychecks based on where the employee works. Small businesses may also need to consider home office deductions, remote work benefits deductions, and reciprocity agreements.
To navigate these tax challenges, small businesses can work with experienced tax professionals, implement policies and procedures, and potentially use tax software. By taking these steps, small businesses can successfully navigate the tax challenges of remote work.
This month, I’d like to emphasize the significance of online reviews, both for our business and yours. In today’s digital age, online reviews have become an essential element in establishing a company’s reputation. They serve as an invaluable source of information for prospective clients who are diligently researching various companies. These reviews play a vital role in shaping customer behavior and ultimately driving new business.
As the New Year approaches, it’s a good time to reflect on your financial situation and make any necessary adjustments to potentially lower your tax burden. Maximizing your retirement contributions is one area to consider, with those 50 and over allowed to make pre-tax contributions to a 401(k) of up to $27,000 per year.
Taking stock of your stock options is also important, as exercising them can have tax implications. Estimating your capital gains and losses before the end of the year can help you make informed decisions about selling securities or other assets, potentially changing your tax bracket.
It is also essential to evaluate your Health and Flexible Spending Accounts, as the funds in an HSA carry over to the next year, while unused funds in an FSA will be forfeited as of December 31st. Be sure to speak with your tax professional or financial advisor to help you make the most of these opportunities.
With the holiday season fast approaching, many people are thinking about giving back to their communities through charitable donations. It’s important to understand the rules and regulations surrounding charitable gift deductions, so you can maximize the tax benefits of your giving.
To qualify for a tax deduction, the organization you donate to must have tax-exempt status, which means it operates for charitable, religious, scientific, or educational purposes, among others. You can use the IRS’s search tool to verify an organization’s status.
It’s worth noting that changes were made to charitable giving deductions in the 2020 and 2021 tax years due to COVID relief efforts.
As the IRS receives a massive funding boost aimed at improving enforcement efforts and closing the “tax gap,” many taxpayers may be wondering how to avoid getting audited. While it is impossible to completely eliminate the chances of being audited, there are practical steps you can take to lessen your exposure.
The most crucial step is to avoid making common mistakes that are frequently flagged by IRS computers, such as filing or paying taxes late or not reporting all income that has been reported to the IRS by others. Additionally, taxpayers should avoid reporting losses from business activities that the IRS might view as hobbies and should provide specific information about their deductions.
Other actions to avoid include using the same annual figures repeatedly and using all perfectly round numbers in your tax return. Taking these precautions can help reduce the likelihood of being selected for an audit by the IRS.