Here’s Everything Your Accountant Needs to File Your Business Tax Returns

Many businesses find income tax preparation burdensome. Not to mention, tax mistakes can be quite costly. This is why businesses may enlist the help of tax accountants whose focus is to maximize your tax deductions and file your returns before the deadline in order to avoid penalties.

However, there are a few pre-requisites. In short, there are two things businesses need to do. Keeping their bookkeeping in order and providing financial and personal information.

You’ll need to hand over the following to your tax preparer:

The Basic documents

The following documents must be provided to your accountants, regardless of the business type.

Last year’s tax returns

If filed, your accountant would require:

  • Name, SSN, Birth date
  • EIN, visit the IRS website
  • Tax payments made quarterly in the last year
  • Previous year’s adjusted gross income
  • Paid payroll taxes.

All tax forms related to your employees

Businesses need to file W-2 for each individual employee, to note the wages, overtime or compensations paid during the year.

For contractual services acquired during the tax year, businesses file 1099-MISC for every contractor.

Income statements, with Cost of Goods Sold

The income statement is required, with all relevant revenues and expenses. COGS refers to the product cost which businesses sold in the particular year.

Trial Balance

This acts as a summary of all transactions a business made over the year.

Financials related to deductions

  • Credit cards and bank statements
  • Legal fees
  • Utility and travel expenses
  • Investments
  • Mileage records
  • Charitable donations and contributions
  • Education expenses
  • Property tax
  • Foreign income and taxes
  • Automobile payments
  • Medical payments
  • Moving expenses
  • Taxes on real estate

More documents may be required by the accountant, depending on the type of entity the business might be.

For sole proprietorship

For businesses that are run by one individual person:

All proprietor specific tax forms

Businesses report their earnings through IRS Schedule C.

For partnership

Partnership implies more than one owner working together to form a business. They include general partnership and Limited Liability Corporation (taxed as a partnership)

Partnership specific tax forms

Partnerships have to use Form 1065 for filing, and all partners file Schedule K-1, with their tax returns (Form1040)

Related information with Partnerships

  • List of all states where your business operates
  • The partnership agreement
  • Name, home address, and the SSN for each partner in the year
  • Reports on owner contributions, loans, withdrawals, guaranteed payments and benefits.

C Corporation

C corp. is an entity that’s taxed independently from its owners.

All C corporation-specific records

C Corps use Form 1120 to report their income.

All C Corp-specific records and information

  • Name of states where your business has reporting requirements
  • Bylaws, agreements and amendments
  • Each owner’s information (legal name, home address, SSN etc.)
  • Sales reports, payroll, and properties of each state.
  • Credit certificates that have been issued by the state authorities

A professional tax expert makes all the difference. To avail comprehensive tax services, contact A&B Accounting and Business Solutions in Fort Lauderdale area. They offer accounting, professional bookkeeping, tax, QuickBooks payroll service and more, across South Florida.

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