Most Commonly Asked Questions about Taxes

Whether you are a new business owner or have a solid background in doing business, taxes will always remain an enigma for most business owners. We at Prestige Auditors have collected a list of the most frequently asked questions about taxes in order to simplify the lives of our clients.

 

1. Why Do I Need a Tax Professional’s Help?

Of course, you have to choose for yourself whether you need a tax advisor’s help or not. If you are running your business solely in one state and everything is pretty clear with your taxes, then you can manage the process of tax filing by yourself.  At the same time, if you run your business in several states, where each has its unique tax laws, then it is better to hire a tax professional. A tax pro will handle all your tax issues in accordance with every state’s tax laws, and give you tax guidance through the year. Another reason for hiring a tax advisor is when you are going to invest money in some businesses. Tax professionals will consider all pros and cons of investing your money in a new business.

2. It Is Better to Itemize or Use Tax Deduction?

You should consult with tax professional regarding this exact question, since this is considered to be one of the most commonly asked questions among business owners. We cannot give the right answer to this question, since in most of the cases it depends on every unique situation.  Contact Prestige Auditors, and we will give you the answers of all your questions concerning your unique situation.

 

3. How Can I reduce My Tax Debts?

Another frequently asked question refers to reducing tax debts. Of course, it is possible, and most of the business owners are successfully practicing this. There are several ways of cutting your tax debts. Reach out to Prestige Auditors and we will help you choose the best deduction which will help you drastically cut your tax debts with the IRS.

4. What is the Difference Between Tax Deduction and Tax Credits?

Both of them are used to reduce the business owner’s taxes. However, there are several differences between them: Tax deduction’s aim is to lower your taxable income. At the same time, the tax credit can reduce the amount of taxes that you owe to the IRS. There are several types of Tax Deductions, such as Office Expenses, Marketing Expenses, Travel Expenses, etc. Tax Credit also involves several categories such as Child Tax Credit and Mortgage Interest Tax Credit. Both of them are perfect in reducing taxes, but you have to figure out first which of them suits you more.

5. How to Reduce a Risk of an Audit?

An IRS audit is a nightmare for most business owners. And all of them do their best in order to avoid such unpleasant issues within their business. The first group which is at risk for an IRS audit are those whose profit is more than $ 1 million per year. If you want to avoid an IRS audit, try to file your tax returns in a timely fashion, and do not forget about reporting all the information concerning your income. Another crucial part refers to your records; try to ensure that there is no mismatching information in your documents.

 

We have tried to answer the most commonly-asked questions for our readers. If you have any additional questions concerning your business, contact Prestige Auditors and we will not only give the answers of all your questions, but also help you in solving all the tax issues within your business.