4 out of 5 people have lost money this tax year
I understand that there have been quite a number of narratives out there saying tax practitioners help businesses evade tax. Well, that’s not correct. In fact, we help you make the best out of staying tax compliant. As such, I thought I should just deal with this misleading narrative before delving into today’s article. This, I did in case you would choose to follow the wrong narratives without adequate information.
Nevertheless, this article serves as a pointer to the reasons why 4 out of 5 people have been losing money through tax. Imagine, going out to do the right thing only to realize that you have overpaid your dues to the IRS. Or, worse off, to realize that you could not claim back what the IRS was supposed to give to you? These kinds of things are happening daily, and ought to be dealt with, once and for all.
Indeed, 4 out of 5 small business owners are leaving their money at the IRS table. How did I come to know of this? My other professional friends and my clients to have been talking about this figure for too long now. It got me worried, and I decided to explain why is this happening – that 4 in 5 people lose money out on tax in just one tax season!
Why are businesses leaving money on the table?
- You did not keep a record of your charitable donations
Charitable donations are all the small, or big, things that your company gives out to charity. All your local school visits with a few goodies, they make up charitable donations. Keeping a record of those saves you more money from taxes.
One of my clients took all the pictures of her charitable donations. I told her to do so, and it helped her a lot. You can also follow this practice and thank me later. Guess what, all her pictures corresponded to the receipts for the donations. Because it was like that, she easily got her rightful tax refunds from the IRS. What’s the lesson from my client’s clever move? Always keep the paperwork, and make sure it does correspond to the pictures you take when giving donations. Organize yourselves and get the maximum returns!
Remember, all I am about are the numbers. And, the numbers are supposed to work really well where the paperwork has been neatly organized! Have your receipts in place, and in this case, have your pictures in place too! This simple reason can protect you from paying more to the IRS.
- They are operating businesses with no record system
I hope by now we all understand the importance of your business records. However, we cannot just keep them in a safe, and easily readable manner without a good system in place. Without such a record-keeping system, you lose out on your tax savings. I hope we are all following these simple, but more important tax tips for small business owners.
Nevertheless, small entrepreneurs have disappointed the most in this end. From the small invoices to the small donations made to charity, there are just no proper records, at all. Small businesses lose so much more to the IRS when the state of the paperwork is in shambles.
Please take the time out and put a proper records system in place. Failure to do so only hurts your business. Be good stewards of your own money, and what you have right now in order to become financially free.
I will tell you that 4 out of 5 small business owners I spoke to this year have no records system in place. These are some of the things that they easily ignore, but by doing so, they are bleeding their businesses of a couple of thousands of dollars.
I wouldn’t lie to you, that (ignoring record-keeping) is the easiest formula to failure. Why? Because doors shut easily on you when you don’t have records, and you lose more money to the taxman when nothing is in place in terms of your records. If you want to be a real business owner step up and do the right thing. It’s cumbersome, but worth it in the end. Never sound like an employee if you want to run the show, and stay being the boss. Just stop leaving money on the table! I say so because employees complain about the workload and the following procedures. They want things easy, but you shouldn’t because a lot depends on your business acumen, and the willingness to put in the hours.
- You are basically frustrated about the tax system; you lack knowledge
There are just a few reasons why an entrepreneur would be frustrated all day long. One of the reasons is, your income is so low and you are concerned about how to save it through manipulating tax systems. When it is like this, you easily forget about making more money. More frustration piles up!
Frustration comes from a lack of knowledge, and I have been seeing it over the past years. 85% of the advice that most people are giving to each other is lies. You are just not fully knowledgeable of the tax system, and, the end result is prolonged frustration that eats away from your business time. You get easily frustrated about the small nitty-gritty of the system, thus forgetting to improve your products. Just stop taking bad business advice. Stop taking bad advice because you want a tax refund. Concentrate on the more important things about your business.
These important things are; organizing your numbers, hiring the right tax professionals, and improving your products and customer services.
So, you don’t have the knowledge, fine, but, will you pay for it? Always find the right information for the business. Paying for it should not be the reason to be worried about it. But, always make sure to know what you have to know so that your business is protected enough. Do not go the shady way, it is not worth it. Tax fraud can be the worst nightmare to happen to your business, so, do not cut corners. Find the right tax practitioner and keep your business running, and profitable.
