If you buy something through our links, we may earn money from our affiliate partners. Learn more.
As a small business owner, it is important that you know everything about taxes and filing them. for your small business. You both as an individual or business owner are required to pay taxes, and you need to know what to expect when it comes to your obligations to federal, state, and local taxes. Small business owners can find it difficult navigating the complex system of taxes and can seek the help of a tax professional for tax planning and reporting.
What are Small Business Tax Services?
Small business tax services help you by offering bookkeeping, payroll, and tax solutions to help your business stay on top of your accounting processes. A tax service company comes in handy for businesses during tax season as they actually work as a tax preparer helping you with your taxable income that includes calculating your taxable income including self-employment income in addition to advising you on your tax return. This includes deductions and knowing the top 25 small business tax deductions can help you find out what you qualify for.
Do You Need a Small Business Tax Service?
As a small business owner, it is important that you know everything about taxes and filing them. for your small business. If you feel overwhelmed with the day-to-day operations of your business and focused more on growing your business then you might consider seeking the help of a small business tax service to help you deal with your taxes. By outsourcing your small business tax preparation process you let others help you in filing tax forms and get tax advice from professionals that have knowledge of tax laws.
How to Choose the Best Preparation Service for Your Small Business Taxes
A good small business tax preparation service for Your business should help you file your taxes accurately and make payments on time. In addition, it should help you:
User-friendly: They should make it easy for you to file taxes and help you avoid costly mistakes.
Help with e-filling: The service provider should offer IRS e-file.
Are available for consultations: In case you have queries and advice they should be readily available to help you with your concerns.
Should provide records and receipts: A good preparer should help you with keeping and updating records and receipts.
Top Small Business Tax Preparation Services
Below is our top pick of small business tax preparation services.
1. H&R Block
H&R Block specializes in consumer tax services provider for small business owners and self-employed individuals. They offer taxes, bookkeeping, and payroll solutions that include online tax filing, file with a tax professional that helps users in their credit and deduction calculation. It offers the easiest tax software platforms in the market where it can help you file your taxes online.
If you are interested in doing your taxes by yourself H&R Block offers you all the tools you need with its online version including self-employment and small business income on your tax returns; option to upgrade for on-demand assistance from a tax expert and even has a mobile app that allows you to upload tax documents and track your filing status.
Its free tier offers you to file simple returns, unemployment income, W-2 tax forms for your employees, and more. With its robust premium tier set at $ 49.99 your get support for Earned Income Credit (EITC); Child Tax Credit (CTC); report for retirement income; digitally organize all of your tax documents for up to six years; access to live phone or chat support and more.
2. KPMG Spark
KPMG Spark offers managed accounting through cloud-based bookkeeping and accounting software. It uses live data to give users real-time reports on income and expenses, balances, and more. No more monthly reconciliation. Through its Managed Accounting offering, it offers a scalable way to serve your growing business’ accounting needs through a combination of software and human assistance.
Paid tiers come at $395 a month which is ideal for businesses with 1-100 monthly transactions and 1-3 bank accounts. With it you can manage cash basis accounting; get daily revenue, and expense categorization; real-time bank reconciliation, and credit card reconciliation; access to multiple users; receipt and document storage; generate financial reports on demand and more.
TaxAct is a tax software provider that offers free on-demand, screen-sharing access with a tax professional. With it TaxAct filers get expert assistance from CPAs and other tax experts for no extra charge. Users with another provider can switch to TaxAct by simply uploading a PDF of your previous year’s return. The dedicated tax professionals handle interactions with the IRS on the off chance you get audited over the next three years after you file your return.
Its free version offers users the basics such as simple filers, tax deductions for dependents, and unemployment taxes. Its paid Deluxe tier $ 24.95 helps you manage your W-2 Income, retirement income, earned income credits, stimulus credit, and more.
TaxSlayer offers tax solutions for filing taxes online for customers who earn through a 1099 and need to complete a Schedule C. With it, it allows users to file forms in two ways: quick file or the traditional method. All users have to do is to select the necessary forms and TaxSlayer automatically directs them on how to fill them out. The traditional method is a more guided experience and is suitable for those that involve more complicated finances.
Besides the basic free version, the Classic tier costs $17.95 and offers everything you need to file for your small business taxes including; preparing, printing, and e-filing; helping you claim all your tax breaks; getting help with IRS inquiries for up to one year after your return is accepted and more.
FinancePal offers users one-stop-shop online accounting services for all their tax and accounting needs. When you sign up for FinancePal’s small business accounting services, you gain access to a dedicated accounting team who will oversee your business’s finances by offering detailed financial statements, insights, and recommendations. Its pricing is determined based on your particular business needs and offers a custom quote.
Quickbook’s accounting solution helps you to handle all your expenses from cash flow to payroll and helps you seamlessly organize and run your business. Its basic paid tier starts at a monthly subscription of $12.50 with basic bookkeeping tools while Essential offering comes with a 25 monthly subscription you get income and expense tracking, powerful cash flow management, and reporting to keeps your finances organized.
TurboTax helps you to file your small business taxes on your own and also offers tax experts that can help you walk through your tax return preparation. The TurboTax self-employed tier costs $ 89 and helps you search for deductions personalized, searches for over 500 tax deductions and credits, and more. You also get access to a CPA who will field questions and also chat with you through a video session.
8. Credit Karma
Credit Karma is a credit-monitoring website that allows users to view their TransUnion and Equifax credit scores for free. With it, you’ll also have access to credit insights, such as data on the number of accounts you have open, the number of negative marks on your score, and your credit usage, among others. You also get recommendations on credit cards, loans, insurance, and more. With its free Cash App taxes, you get to file your state and federal tax returns for free. Besides automatically checking for accuracy, you also get audit defense free of charge.
Small business tax software assists taxpayers in preparing and filing income tax returns. They could be form-based tax software or interview-based tax software offering e-filing services, document storage, credit and deduction suggestions, and more.
How to Prepare Taxes for Your Chosen Service
To prepare for yo taxes you will need to do the following. You will first choose a tax preparer; make sure that you have gathered and organized your documents; collect and organize your receipts; make sure you comply with your local and state tax codes; plan ahead for filing your taxes and prepare for your tax return.
What is the average cost of tax preparation for small businesses?
As a small business owner, you will need to know that you have tax obligations when it comes to federal, state, and local tax requirements. The amount of state and local income tax you pay will depend on how much income you earn and the tax rate of the state or locality where you live. According to the Small Business Administration (SBA), small businesses of all types pay an estimated average effective tax rate of 19.8 percent. Sole proprietorships face a 13.3 percent rate, small partnerships face 23.6 percent, and small S corporations face 26.9 percent.
How much can a small business make before paying taxes in the US?
As a small business earnings beyond $400 is considered as a taxable small business income.
What taxes do you pay as a small business owner?
Your business structure will determine what federal taxes you must pay and how you pay them. In general, there are five general types of business taxes: income tax; self-employment tax; estimated tax; employer tax; sales tax; and excise tax.