Last month we had a chance to review our finances and look forward to new ways to save and/or make changes to how our money is spent. Great now that you have settled on a budget, targeted your plan to pay down debt or better yet pay off debt this year. Plus live within your budget by having a plan plus working it with a partner or professional to stay on track and accountable will allow you to reach your financial goals for 2015.
January can start off a bit overwhelming for small business owners as you prepare to close out the year and process any W-2’s for your employees and 1099’s for vendors for the year. See December post “Bookkeeping – Year End Closing” for more tips. Don’t forget that you just only need to send 1099’s to vendors who you have paid $600 or more during the year.
A good business practice is to require a W-9 for all vendors you expect to pay over $600 during year, this will take care of having to call them for their tax ID information and mailing address. All employers must mail out these important income documents by January 31st. Employees will be waiting expectantly for their income tax forms.
IRS announced last week that the tax season will officially begin on January 20th for both electronic and paper returns to be filed. So you may be thinking of how much your income tax return will be this year and look forward to and how will you spent it. If you are paying down debt it should be allocated to that, just saying…
Unless you have a fourth quarter estimated tax payment due for 2014, which is due on January 15th. However, you can skip this estimated payment without penalty if you file and pay the balance in full by February 2, 2015.
Most taxpayer will probably have their income tax documents by mid-February. Make sure you have all of your documents before you meet with your tax professional. 2014 tax season will be the most complex year for both tax professionals and taxpayers. If you have enrolled in the Affordable Care Act, you will also receive an additional form 1095-A Health Insurance Marketplace Statement that must be filed with your return.
The Health Insurance Marketplace will send Form 1095-A to each tax filer who has a policy, on or before January 31st with a letter explaining (see letter) why the 1095-A is important in filing your 2014 income tax return.
Thinking is one thing no one has ever been able to tax. –Charles Kettering
Remember to review your income and expenses for last year. If you are using software to manage your finances make a report you can use to provide your tax professional with all information to process your return accurately. If you have moved or missing any forms from your bank, employer or charities contact them as soon as you can to inform them where to send your documents. If you are going to a new tax professional this year it is best to also take last years tax return or a copy when you have your appointment. This will ensure that all areas will be addressed and allow you to explain changes if necessary.