Get A Jump On Tax Filing: 7 Tips
 By Stephen A. Lanvil

Don’t look now, but the April 15 tax filing deadline is right around the corner.

If you started your small business in 2009, and this is your first year to file a business tax return, here are seven things you can do now to get a jump-start on the task at hand.

1. Contact your tax professional
Tax season is the busiest time of year for tax professionals and accountants. Call yours now and make an appointment to discuss your tax situation.

If you don’t have a tax professional to work with, ask business associates, friends and family members for recommendations.

2. Determine whether you qualify for the home office deduction
If you run your business primarily from home, you may qualify for the home office tax deduction.

To be eligible for the deduction, you must use a portion of your home regularly and exclusively for business. And you may qualify for the deduction even if the office is located in a home or apartment that you rent.

If intend to take the deduction, you’ll need to gather information on a variety of home expenses to compute your write-off. This includes:

• Mortgage or rent
• Utilities
• Homeowners’ or renters’ insurance
• Real estate taxes
• Repairs and maintenance

3. Compute automobile expenses
If you used your personal vehicle in your business, determine whether you will deduct the actual costs of using the vehicle or whether you’ll take the standard mileage deduction.

If you opt for the standard mileage deduction, the rate for 2009 was 55 cents per mile. For the actual expense deduction, multiply your expenses (gas, insurance, maintenance, etc.) by the business percentage of total miles driven.

4. Gather 1099-MISC forms
If you’re a self-employed sole proprietor, you should receive Forms 1099-MISC from every client that paid you income last year.

You should receive these forms no later than January 31. If you haven’t received a form from a client yet, contact them immediately.

You’ll need all of those forms to complete your tax forms, so gather them now.

5. Total your estimated tax payments
Did you make quarterly estimated tax payments in 2009? If so, total the amounts you paid. You’ll need to know the total amount to determine your final tax obligation.

6. Add up your business expenses
Many expenses incurred in the normal operation of your business may be deductible. These include:

• Business meals and entertainment
• Office supplies
• Capital equipment (including computers and software)
• Travel expenses
• And much more

Gather all of your receipts from these purchases so you can easily tally them up

7. Let AFS help
Don’t let the first year of business taxes fool you. Get answers to all of your questions from the online certified public accountants at AFS ProTax. The service is included with the cost of your AFS Membership! Get answers to questions such as:

• Do I qualify for the home office deduction?
• How do I deduct the cost of using my car in my business?
• Which travel expenses are deductible?
• And more

And prepare now for next year with QuickBooks financial software from Intuit®. This No. 1-rated business software will help you organize your expenses, prepare reports for tax season and work more effectively with your tax professional. Plus, AFS Members receive 20 percent off QuickBooks and get free shipping!

(Posted February 2010)

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