The pangs of tax season

Aside from being an average W-2 tax payer in April, I’m also required to pay my corporate taxes by March 15th. This rule is taking some time to get used to. Seems like my panic hits just after the official deadline, and lasts until after the regular tax season is over. By then I’m finished filing not only my regular taxes, but also my now “extended” corporation taxes. You know, for as much as this country depends on small businesses, they sure don’t make any of it easy to run.

It seems like everyone is a little stressed this time of year over taxes. You can even sense it in the commercials on TV. Come to think of it, it’s almost like the whole month of December. You know, those last stressful 2 week-shopping, hustling & bustling days? Fortunately, the Christmas season ends in opening of gifts and lots of smiles….The tax season, on the other hand, promises nothing but will occasionally offer you a small portion of what they “rightfully” stole from you during the previous year with a meager tax return. Ahem…yippee (sigh). A tax return is supposed to make me excited, right? Excited about what exactly, that the IRS took TOO much away from me during the year?? Excited that I’m getting back only a percentage of the excess amount they took?? Give me a break.

I've learned:
- That in order to owe LESS in corporate taxes, I’m forced to spend MORE. This spending is “controlled” or “strategic” spending, however, on things that my business needs anyway. These are things like printer toner, paper, computer equipment, and software.

- That the silly game that the IRS plays with corporations requires that I actually TRY to end up with a net loss at the end of the year. Something’s wrong here. This is backwards.

- That a corporation starts out as with a default status of “C-Corp” which, among other things, subjects me to having my taxes due in March. Last year I filed for an “S-Corp” status so this year I’ll be filing in April again.

- That as a corporation, one of the best ways to keep the IRS from TAKING Tyed Art’s money is to give it away! That’s right, charity. It’s similar to paying a personal tithe as an individual. Any charitable donations and gifts can be written off and tax deducted. This is why the big boys do be sweepstakes and giveaways! It’s not because they can afford to, but rather, because they can’t afford NOT to. If they didn’t give away their money, they’d end up paying MORE in taxes. Again, something isn’t right here.

I'm glad:
That there are capable and competent accountants out there to help me figure all this out.

I wish:
I had a better aptitude towards bookkeeping. It’s a chore for me. I actually don’t mind sitting down and getting things recorded. I’m a very organized person. My problem is remembering to DO it in the first place.

I will:
Have to learn a lot more about what types of tax breaks and legal loopholes there are out there. One doesn’t profit much from being a corporation when one doesn’t know much about being incorporated or about taxes. I need to become more corporation, tax and financially literate.