If you’re running a small business, there are several dates that will be important to you that you may not have given much thought to before. Filing your taxes and staying on top of essential deadlines will keep things running smoothly.
Key Takeaways
- The important tax date comes around every year on April 15 for individual filing. But for businesses, the days relevant to you for tax purposes happen year-round.
- Filing extensions are possible, if you’re unable to file your annual taxes by April 15, you can file an extension by that date instead and you will be given up to six additional months to submit your taxes.
- Having accurate accounting helps to keep track of all of this, and accounting software is a great help, making life easier on you when you need to file your taxes. It also gives you a much better picture of your business’s overall operation and can help you understand where your business is and where its potential for growth may be.
Important Tax Dates of 2023
You’re familiar with tax day for your individual filings — it comes around every year on April 15. But for businesses, the days relevant to you for tax purposes happen year-round. Here are key filing season dates:
- January 14: IRS Free File opens. Taxpayers can begin filing returns through IRS Free File partners; tax returns will be transmitted to the IRS starting January 24. Tax software companies also are accepting tax filings in advance.
- January 18: Due date for the tax year 2021 fourth-quarter estimated tax payment.
- January 24: IRS begins the 2023 tax season. Individual 2022 tax returns begin being accepted and processing begins
- January 28: Earned Income Tax Credit Awareness Day to raise awareness of valuable tax credits available to many people – including the option to use the prior-year income to qualify.
- April 18: Due date to file 2021 tax return or request extension and pay the tax owed due to the Emancipation Day holiday in Washington, D.C., even for those who live outside the area.
- April 19: Due date to file 2021 tax return or request extension and pay the tax owed for those who live in MA or ME due to Patriots’ Day holiday
- October 17: Due date to file for those requesting an extension on their 2021 tax returns
Filing Extensions
There will be times when it just won’t be possible for you to file your taxes on deadline. Perhaps you’re having trouble getting all of your paperwork in order, are experiencing an emergency situation that’s making it difficult to complete your work, or let the date slip your mind and are now scrambling to get back on track. Don’t worry. In most cases, you can file for an extension to give you more time to submit your taxes.
If you’re unable to file your annual taxes by April 15, you can file an extension by that date instead. If you do, you will be given up to six additional months to submit your taxes. S corporations (S-corps) and partnerships can file Form 7004 and be given until September 15 to submit their annual taxes. Sole proprietorships and LLCs can file Form 4868 and take until October 15 to get their annual taxes in order.
Failure to pay your taxes and failing to not file for an extension can result in fines. You will be required to pay 0.5% of your unpaid tax bill for each month that you don’t pay. This adds up to a maximum of 25% of your total tax bill. If you continue not to pay your taxes, the IRS may choose to deduct what you owe from your future taxes, paychecks, or even repossess your property or possessions to pay back the debt. You may also face jail time for failing to pay.
Small Business Tax Checklist for 2023
Filing business taxes is a bit more complicated than filing your personal income tax. You’ll need to make sure that you cover all of the necessary areas that businesses need to declare with the IRS. This small business tax checklist should help you stay on top of it all:
- Income taxes: Based on your business income, the form you file depends on the structure of your company. Relevant forms include: Form 1065, Form 1120, Form 1120S
- Payroll taxes: Relevant forms include: Forms 1097, 1098, 1099, Forms 3921 and 3922, and Forms W-2 and W-2G
- Employment taxes: Employment taxes refers to the withholdings that need to be made from your employee’s paychecks for Medicare, Social Security, and unemployment insurance.Relevant forms include: Form 940, 941, 943, 944, or 945
- Estimated taxes: Estimated taxes seek to estimate your tax liability for the year and split them into quarterly payments. This information will be adjusted during your annual tax filing and you either need to pay in or receive a refund based on this information. Relevant forms include Form 1120-W
- Excise taxes: Excise taxes vary based on your industry. Relevant forms include: Form 720, 730, Form 11-C, Form 2290
Best Small Business Accounting Software
There are many options out there for accounting software, but not all of them are best suited for small businesses. These are the best small business accounting software suites available to help you keep track of all your accounting, invoices, inventory, and more.
Intuit QuickBooks Online
One of the most popular options for accounting software for a reason, Intuit QuickBooks Online offers an easy-to-use, scalable, cloud-based accounting service. Great for small businesses with plans to grow.
Pros:
- Scalable as you grow
- Easily integrates with third-party applications
- Automatic receipts and transaction categorization
Cons:
- Upgrades add to cost
- Cloud-based system can cause trouble syncing
Cost: Starts at $12.50 per month
Xero
A cloud-based accounting service, Xero stands out with its extensive supply chain management tools and a data-rich dashboard that highlights your financial information in real-time.
Pros:
- Supply chain and inventory management
- Marketplace for third-party app support
- Cloud-based and accessible anywhere
Cons:
- Limited support for reporting
- Additional fee for filing automated clearing house (ACH) payments
Cost: Starts at $60 per month
Zoho Books
Zoho Books is about as easy as it gets when it comes to setting up your bookkeeping. The interface is simple and intuitive, there’s lots of support for third-party apps, and it automates tasks for you to simplify your work.
Pros:
- Easy to navigate interface
- Automatic report generation
- Lots of document management options
Cons:
- Limited payroll support in some states
Cost: Starts at $15 per month
Why Accurate Accounting Is Important for Small Businesses
Businesses can have a lot of moving parts — assets, liabilities, income, expenses, payroll, and more. Having accurate accounting helps to keep track of all of this, making life easier on you when you need to file your taxes. It also gives you a much better picture of your business’s overall operation and can help you understand where your business is and where its potential for growth may be.
Tax Types
- Annual taxes: Annual taxes are filed both for individuals and businesses on April 15. These serve as an overall look at your tax situation over the past year, including how much you owe.
- Payroll taxes: Payroll taxes are those withheld by an employer from an employee’s paycheck to pay in toward Medicare, Social Security, and unemployment.
- FICA: taxes are paid to fund Medicare and Social Security programs. FICA requires 15.3% of an employee’s income go toward Medicare and Social Security funds.
- FUTA: FUTA is taken out of an employee’s paycheck to establish unemployment insurance that can be claimed in case of a layoff. Small businesses typically owe 6% of the first $7,000 paid to each employee, but rates can vary in each state.
- ACA: Employers providing health care to employees are required to file Affordable Care Act (ACA) taxes. This covers the expense of health care plans offered to workers.
Small Business Tax Resources
For additional resources for small business tax-related information, explore these resources:
Small Business and Self-Employment Tax Center
SCORE’s Tax Planning Resources
What To Do Next
Running a small business can feel overwhelming if you’re handling everything yourself. But once you understand the important dates on the small business tax calendar and have access to accounting software that can streamline some of the work, managing your small business can be easy.
The next step is to find the best accounting software that fits your need. Start by figuring out the non-negotiable features your accounting software should have to help you run your business smoothly. As your business expands, most software is scalable, and you can e easily upgrade your plan to match the growing needs of your business.
