Any business in Florida, regardless of size, has to pay taxes. Failure to pay your proper business taxes can result in costly fines down the road. If you’re a small business operating in Florida, you need all the information you can to ensure you’re in financial compliance so your business can continue to grow properly. You don’t want the IRS to come after your business. Read on for more insight about tax information you should be aware of.
Understand Your Business Type
According to local sources, there are over 267,000 small businesses in Dade County, but small businesses can come in many forms. Is your business an LLC, sole proprietorship, S Corp, or a partnership? Knowing the type of business you have affects not only how much you pay, but how you should file your taxes. For example, if you have a Sole Proprietorship, you don’t have to file an additional business tax form aside from your personal one. If you own and started your LLC in Florida, you won’t owe federal taxes on it. Any partnership involves at least two or more people and may fall under a Limited Partnership, Limited Liability Partnership, or General Partnership.
Keep Good Records
When you operate a small business, especially if you operate by yourself, it’s vital to keep accurate records. Luckily, there are all sorts of online software, such as QuickBooks and other accounting apps that can help you keep track of your receipts and business expenses.
All types of small businesses pay an approximated average federal tax rate of 19.8%, according to Nationwide. When it comes time to calculate your final tax fees, good records will make it easier and faster to fill out your tax forms. You’ll also be less likely to be audited.
However, if an audit happens, having accurate records accessible will make the process go smoothly. When you’re able to hand your records over to a local tax professional, you’ll ensure that your information is in good hands.
Find a Tax Professional
Taxes will go a lot better when you have professionals handling things for you. Working with an accountant or bookkeeper year-round will make tax time a cinch. When you have a financial professional handling things, it takes the stress out of your business taxes. In the case of an audit, your tax professional can handle all those issues.
According to Fit Small Business, 85% of accountants worked in an office pre-pandemic, though now many services are remote jobs. Since you have remote options, there’s no excuse not to utilize professional accounting services. Plus, a tax professional can alert you to deductions and tax breaks you may not be aware of otherwise.
Consider Locations in Other States
Does your small Florida business have locations in other cities or states? If so, that can affect the type of tax form you file. Depending on the state, your taxes may become more complicated. That’s why it’s even more imperative to work with a tax professional to help you through the paperwork.
You should also consider residency. Do you live in another state but operate your business in Florida? All these things can affect how you handle your small business taxes.
The business owner in Florida comes with many perks. The state is known for having amazing tax breaks for residents. Just make sure you’re aware of the type of business you operate and hire a professional to help you. The last thing you want is to make your taxes more complicated than needed by not filing on time or not having updated information. By following these tips, you can set your business up for success and keep it from causing significant legal troubles.
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