Tax tips for Start-ups

Here are some tips relative to the financial and tax implications of a new business.  To make the best decisions, you should consult with an attorney or accountant when implementing these tips. (1) Pick a business structure – S or C corporation, LLC, sole proprietorship, etc. (2) Pick a tax year.  For most people this will be January 1 through December 31. (3) Know your business taxes.  Different taxes will apply for different businesses and business structures, e.g. payroll taxes, excise taxes, income taxes. (4) Pick an accounting method.  This will be cash or accrual.  Usually cash is better for a small business.  (5) Keep good records, especially a monthly P&L statement.  This just makes good sense, especially if you get audited.  (6) Obtain an EIN (Employer Identification Number).  The attorney or accountant can get this for you.  It is always better to use an EIN for the business rather than trying to use your social security number.