As the new owner of a small business, you'll have many responsibilities, all of which require your time and attention. It only takes one mistake to lead you down a dark path, so you need to stay on top of everything.
For example, tax mistakes can creep up on you when you least expect it. Here are a handful of common mistakes that you need to prevent at all costs:
- Not understanding what types of business expenses you can write off. There are many of these to consider, and you need to take advantage of each one. At the same time, you can't break the rules as set by the Internal Revenue Service (IRS).
- Neglecting to separate your personal and business affairs. A big mistake among new small business owners, you don't want to comingle your personal finances with your company. For example, don't use your personal bank account to make purchases for your business (or vice versa).
- Payroll errors. With each employee you hire, it becomes more important to understand the payroll process, including any mistakes that could get in your way. If you don't understand what's expected of your business, you can hire a payroll company to handle everything for you.
Along with the above, it's better to be safe than sorry in the record-keeping department. Make sure you keep detailed records, while also storing them in a safe place.
There are many things you can do to prepare yourself for business success. Be sure to keep a close eye on your tax situation, as you don't want to run into any issues with this part of your company.
Source: SBA, "8 Small Business Tax Preparation Mistakes to Avoid," accessed March 14, 2018