What Tax Season Should Teach You

"Is there really a slow time of year for businesses"?

The short answer to that question is, "no." A great way to keep your eye on the ball, even during busy seasons, is to predict, plan, & pivot. However, companies must prioritize working on their business while fully operating throughout the year, or the business simply will not survive.

Predict As you wrap up your taxes, do not simply file your returns away and resume business as usual. Use your return to forecast tax liabilities for next year. Go through your returns with your accountant or tax professional to truly understand where your business stands from a tax standpoint.

Plan Forecasting your taxes is an example of proactive planning and will help you avoid a huge tax bill. If your tax liabilities were as expected, you are in good shape. If your numbers are not what you expected, your accountant should help you identify what changed. If you file your own taxes, look over your reporting to determine where the shift happened.

Pivot If we have not learned anything, we have learned to pivot together. The past three years have taught us that you cannot always plan your way around a situation. For companies that have been in business for at least five years, you may have done tremendous forecasting, and the numbers you thought you knew pre-pandemic were dramatically changing, and you needed to act fast. However, predicting and planning prepare you to make the best pivot. You have to know where you are to understand where you are going.

Understanding your taxes equips you with the knowledge to lessen the impact of taxes on your business year-to-year. There are many languages in business, taxes being one of them. Do not be afraid to seek help from a professional.