How to Avoid a Business Audit on Maui
Are you afraid of a business audit on Maui?
Many, if not most small company owners fear the possibility of being audited by the IRS. The government agency tends to have quite a reputation for this particular reason.
But the Internal Revenue Service wouldn’t give small business owners a reason to stress out, unless they need to. If everything looks good and you make the right choices when it comes to filing your tax return, you can significantly lower your chances of being called in for a business audit on Maui.
Keep reading to learn about how, when and what to file in order to avoid a business audit.
1. To avoid a business audit on Maui, always be accurate when it comes to your taxes
Needless to say, you should always be careful when filing your taxes. Hiring a bookkeeper is always a good idea and using a good tax preparation software will help you avoid possible costly mistakes.
Be extra careful when filing for deductions. Be accurate when stating your expense categories and avoid vague descriptions such as “various” or “miscellaneous”.
But being thorough might not help your case if you “forget” to report your income on time or at all! Make sure you never miss a tax return deadline, or you might raise suspicions and get called in for a business audit on Maui when you least expect it.
2. Always file your tax returns on time and be careful about deducting your small business costs
Speaking of deadlines and filing a tax return on time, you should also avoid filing your taxes too early. You might think you’d be doing yourself and your accountant a favor, but in reality, you might invite the tax collection agency to review you case, with plenty time to spare!
You should also be careful when deducting your new small business costs. Not all expenses can be deducted immediately and you should pay extra attention to the rules and regulations of a home office deduction. Anything that doesn’t comply with the law will raise a red flag and will give the IRS a reason to call you in for an audit.
3. Mixing business and personal deductions could increase your chances of being called for a business audit in Maui
Do you enjoy travelling abroad on vacation or are the type of person to change phones or you car very often?
There are myriad reasons why you shouldn’t mix business with pleasure. And a business audit on Maui is “scary” enough to make you think twice before you mix personal and business deductions on your tax return!
4. Hire a certified public accountant to lower the risk of a business audit on Maui
Last, but definitely not least, consider hiring a CPA on Maui to help lower the risk of a business audit!
Not only can a certified tax expert help you file accurate and thorough returns. But just in case the IRS does decide to call you in for quick audit session, you can count on an experienced professional to represent you in front of the tax collection agency and present your case like a pro.