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The (New) American Dream

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A study conducted in the spring of 2018, commissioned by the UPS Store, found that 75 percent of Americans dream of owning their own business. Although the reasons for this dream and the precise kind of business varied, most Americans who said they dreamed of opening a business were also confident in its success. However, finances topped the list of fears holding these potential entrepreneurs back, including the stress of dealing with taxes as a business.

Florida State Income Taxes 

The good news is that taxes should not add much additional stress for Florida business owners. The odds are that your small business start-up will not have to pay state income taxes in Florida, since only C corporations and sometimes S corporations are required to do so. This means that your decisions about the kind of business entity you will run make the biggest impact on your potential tax liabilities, something an experienced tax attorney can assist you with.

Additionally, since Florida does not require individuals to pay state income tax, the amount you pay yourself from your small business will not be taxed as income. This means that your only real concern as a new small business owner is federal tax and, if you have other employees who are not independent contractors, the amount of tax to withhold from their pay.

Tax Time Made Easy

No matter what kind of business entity you have, tax time doesn’t have to be stressful. Even if you’ve started your own business this year or plan to soon, there is no need to worry about your first year filing taxes for your business. Simple organization can put your mind at ease. Start by:

  • Using separate accounts for business and personal transactions;
  • Saving every business-related receipt;
  • Tracking all income and expenses; and
  • Tracking all employee tax information and pay.

These steps will make it much easier to complete your tax return. However, if you’d like to make your life (and your accountant’s) even easier, find  good accounting software. There are even some available for free to get you started. You can also help by knowing your deductible expenses, as detailed by the IRS, so that you track those expenses which are most important.

When Not to DIY 

When you own your own business, taxes should no longer be a do-it-yourself project. It is well worth your time and money to hire an experienced accountant to prepare your taxes. Your accountant can ensure that all forms are filed properly, maximum deductions are taken, and that your tax payments are as low as possible. However, an accountant can’t handle all of your business’s legal needs.

Contact an Attorney Today 

If you’re planning to start your own business, call an experienced business law or tax preparation attorney today. Tampa attorney David Toback can assist you in setting up the best kind of business entity to help protect your business’s assets and minimize your tax liability. Even if you’ve already started your own business, contact our office today and let us advise you on any necessary restructuring to help reduce your tax liability.

Resources:

theupsstore.com/about/pressroom/survey-finds-most-americans-dream-of-opening-small-business

irs.gov/businesses/small-businesses-self-employed/deducting-business-expenses

https://www.davidtobacklaw.com/do-you-know-how-to-correctly-classify-your-workers/

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