Today TaxMama hears from Lori in Illinois who’s trying to catch up. “I started an S corporation last year . My attorney/ accountant friend advised me that I could skip the first round of estimated taxes. Well time has gotten away from me and I have the paperwork the government has sent to me, but haven’t filed anything yet. ( I did read your book). If my expenses outweigh my initial year income, is it OK that I haven’t filed? Also how should I start and do I have to claim the past year?”
If you’ve read Small Business Taxes Made Easy, you already know that the first thing you need to do is to build your advisory team. So, please start looking around you for the best local tax professional you can find, as the first member of that team.
Asking a friend for general guidance, rather than engaging a professional (even if that pro does happen to be your friend) are two different things.
Have your pro look things over. And if your first year in business resulted in losses, you shouldn’t have any taxes due. So that will be fine.
Hopefully, you got an extension to file your tax return last March 15th. If not, it won’t be the end of the world – if you do have a loss. You won’t owe any taxes. But please, get into the habit of filing extensions when deadlines approach.
Once you get your S corporation tax return done – sit down immediately and start planning this year’s taxes. And if you’re expecting a loss again – look carefully at your business to see how you increase your income.
Hey, you’re in business to make a profit – not to get tax write-offs. I want to see you thrive!
And remember, you can find answers to all kinds of questions about filing late corporation returns and other tax issues, free. Where? Where else? At TaxMama.com[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.]
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