The end of January is a magical time in the business and accounting world. It means the books are all squared away and ready for their next big adventure: taxes. We are here again to be that friendly voice and remind you of some key items to put on your radar now, before it gets too late.
If you are in a not-so-magical place with your taxes, you still have time and options. Lucky for you, Accountfully has also enhanced and expanded its tax department, with even more capabilities to help in the complex 2020 tax time navigation. To better assess the situation in the meantime, here are the high level summaries of dates, and important considerations for filing your 2020 return.
Important Deadlines Soon Arriving
How close are we to important deadlines? Well, as usual, that depends on what type of company you are. In any case, you should at least have your books closed through December of last year. You should understand these important deadlines and plan for them ASAP. As a refresher, here they are:
- March 15, 2021: This is the due date for S-corps and LLC Partnerships
- S-Corps will file an 1120S
- LLC Partnerships will file a 1065
- April 15th, 2021: The more “classic” tax due date we are all used to hearing. This is when C-corps and single member LLC’s will need to file, since these flow through personal taxes:
- C-corps, Sole-Proprietors, and single member LLCs will have a Schedule C with their 1040
Need More Time?
If you need to file an extension, you can do this. Make sure to actually file one first, then understand the considerations associated with one. Any estimated tax payments are still due on the dates above. Not paying these on time can result in penalties and interest charges.
Companies That Create and Develop Products Have Some Special Benefits
If you are a business owner that has been riding the wave of creating and testing a new product, you are in luck - there are some tax opportunities available to you. For businesses that have research and development (R&D) expenses, you can take owner expenses surrounding R&D to offset your income taxes or payroll taxes. Examples include product development expenses, like a new food or food category, or new brand. If this sounds applicable to you, make sure you are in touch with a tax pro that can help you properly account for these expenses.
COVID Related Loans
Last year’s multiple PPP related funding opportunities will make this year’s taxes a lot more complex. You will need to ensure that you are properly managing this on your tax return.
eCommerce Complexities From 2020
Another important factor related to the rise in online sales from COVID, is the new areas of compliance and complex filing requirements associated with it. If you are selling across multiple (or new) states, you will need to address that on your taxes. Accountfully can help you stay compliant with any additional or new state filing requirements from 2020 and moving forward. It’s a great thing that many eComm companies experienced increased revenue from the rise in popularity of online sales, but will need to make sure they are paying the proper taxes inline with those changes.
Workforce Complexities From 2020
Falling alongside the other changes from 2020’s tax challenges, are workforce related filings. The bulk of the workforce went remote, which means many employees may have changed the dynamic of their employee status; from W2 to contractor (1099), from full to part time, to new location, or new employee related expenses. Cohesive, one location teams may have turned into a workforce spanning multiple states. Similar to eComm considerations spreading across state lines, are the filing requirements for employees. We can help you understand and navigate this.
Accountfully Is Here to Help
Taxes can still incite a classic cringe reaction from business owners, especially if they are working against themselves with reactive bookkeeping and last minute receipt wrangling. 2020 was NOT the year to have things disorganized, but it was also a very chaotic and disorganized year for everyone. While this didn't set any business up for much planning success, you can still get things done properly. In fact, if there ever was a pivotal tax year to get right, the 2020 tax year is it.
If you are in need of a professional team experienced in filing for all types of businesses, across all industries and states, Accountfully can help. We offer tax packages to fit the needs of your business, whether full time client or not. We have bolstered our tax team and they are ready to handle the rigorous demands of these new complexities. We can also help manage the added challenges of new and additional tax compliance concerns, and act as your advisor now, and as we move forward. Stay tuned to see more exciting tax related changes from Accountfully’s team in the coming months, too!
If you need us to help you navigate tax time 2020 with confidence (and compliance), feel free to reach out. The best way to reach out to us is through our get started form, where you can tell us a bit more about your specific needs and schedule a time to talk. Here’s to 2020 being “in the books” with confidence and compliance!