Staying Ahead: 2025 Tax Preparation Tips

Business tax filings are due on March 15th. If your business isn’t ready yet, here are our tips to polish up your 2024 books in this last home stretch before the deadline, and how Team One Accounting can help.

Digitize and Categorize Financial Records Now

Instead of sifting through paper piles in March, start digitizing receipts and invoices today. Use tools like a mobile receipt scanner or apps like Dext or Expensify to upload and categorize expenses immediately. For QuickBooks Online users, leverage the automatic bank feed feature to sync your transactions and organize them into categories, saving time during reconciliation. Ensure that every expense is properly coded—misclassified transactions can lead to missed deductions. (This is our bread and butter at Team One Accounting!)

Review and Update Vendor and Contractor Information

January 31 was the deadline to issue 1099 forms to contractors. Prep for next year by regularly reviewing your vendor list to identify who qualifies for a 1099 (typically non-corporate vendors paid $600 or more during the year). Double-check their Taxpayer Identification Numbers (TINs) and addresses to avoid delays. If you’re missing W-9 forms, request them now to avoid scrambling later.

Pinpoint Lesser-Known Tax Deductions

Go beyond the basics of mileage and office expenses. For example, if you’ve provided employees with snacks, meals, or office decorations, you may qualify for partial deductions under entertainment and meal expenses. Similarly, if your business invested in energy-efficient equipment, you might qualify for green energy tax credits. Team One Accounting can help you explore industry-specific deductions to maximize savings.

Reconcile Payroll Records

Payroll errors can lead to penalties and tax complications. Audit your payroll system to ensure all wages, bonuses, and benefits have been accurately recorded. Verify that payroll tax filings match the amounts reported on your year-end W-2s and 941/940 forms. Team One Accounting takes great care to keep payroll records accurate for our clients.

Conduct a Year-End Cash Flow Analysis

Review your financial reports to identify trends or issues that could impact tax planning. For example, large year-end purchases might shift your profit margins, allowing for potential deductions like Section 179 depreciation. By analyzing inflows and outflows early, you’ll know whether deferring income or accelerating expenses could benefit your tax liability.

Plan for State-Specific Tax Obligations

State and local taxes often come with unique deadlines and requirements. For example, if you operate in multiple states, you may need to file state-specific returns or handle sales tax reconciliation. Ensure you’re compliant by verifying tax rates and deadlines with your state’s tax authority.

Optimize Retirement Contributions

If you have a SEP IRA, SIMPLE IRA, or 401(k) plan, calculate how much you can contribute before the tax year closes. Contributions can often be deducted, reducing your taxable income. For small business owners, increasing employer contributions for employees can also lower business tax liability while boosting employee satisfaction.

Leverage a Professional Accountant’s Expertise

Even with the best tools, tax preparation requires detailed knowledge of tax laws and industry nuances. At Team One Accounting, our QuickBooks Certified ProAdvisors specialize in working with small and medium businesses, ensuring your financials are accurate and optimized. From finding overlooked deductions to managing multi-state filings, we’re here to simplify the process and help you stay ahead.

Your Financial Goals Are Within Reach!

With expert support from Team One Accounting, you can save time, reduce stress, and focus on what you do best—growing your business. Schedule a consultation today and see how we can make a difference!