What is the BOI reporting?
The BOI report is a mandatory document established by FinCEN. Its purpose is to identify the persons who own or benefit from a business...
Paying taxes for businesses and individuals is a fundamental part of financial management, and having the right documentation is crucial to meet tax obligations. In this article, we explore the key elements you need to optimize your tax declaration for businesses and individuals in the year 2023.
Businesses undertake significant tax obligations, including timely filing of federal tax returns such as income tax and compliance with state requirements, such as filing the Annual Report or Franchise Tax. To streamline the filing process and avoid errors, it is essential to consider the following requirements:
Make sure to gather bank statements from all your business accounts in the United States throughout the year 2023. Obtaining complete documentation is essential to solidly support all your financial transactions.
Maintain a detailed record of all income and expenses related to your business, covering sales invoices, purchase receipts, service invoices, and payroll details. This step is crucial to ensure an accurate and detailed declaration.
If your company has employees, ensure you keep updated records of salaries, withheld taxes, benefits, and any other relevant information. This contributes to efficient management of your tax obligations.
Obtain an Employer Identification Number (EIN) for your company. This number is essential for meeting tax requirements and is equivalent to the SSN but oriented toward your business entity.
Retain documents supporting withholdings applied in the USA and abroad. These withholdings can be used as a tax credit in your company's tax declaration. It is a fundamental part of successfully navigating processes related to business taxes.
Include financial reports such as financial statements, balances, and profit and loss accounts in your documentation. These reports provide a comprehensive view of your business's financial health.
Keep the ownership composition of your company updated, identifying partners and their respective percentages of participation. This information is vital for complying with tax and legal requirements.
Complementing business tax filing, don't forget that personal filing is a crucial aspect of your financial stability and compliance with tax responsibilities. In fulfilling this obligation, it is essential to consider the following requirements to prevent errors in the process:
Collect bank statements from all your personal accounts in the U.S. during the year 2023. These will form the basis for supporting your personal transactions.
If you received income from investments, property rentals, unemployment benefits, bank interest, or other sources, gather the necessary documentation supporting these income streams.
Retain proof of property tax payments if you are a property owner. These payments can be deducted from your tax declaration.
If you were employed in the U.S., have your Forms W-2s or 1099s ready to facilitate the declaration process.
To claim deductions, organize documentation supporting them, such as charitable donation receipts, medical bills, and personal expense receipts.
Keep records of withholdings made, whether in the USA or abroad, to use them as a tax credit in your personal declaration.
In both cases, whether for business or personal taxes, ensure your company's physical notification address in the U.S. is up to date. This detail may go unnoticed but is crucial for receiving official tax-related communications.
Preparing the right documentation is key to the success of your tax declaration. By following these steps and keeping your records updated, you will be on the right path to meet your tax obligations in the year 2023. At Prodezk, we provide 360-degree guidance, understanding your needs, and supporting you at all times. Trust us to optimize your approach to business taxes and ensure efficient financial management. Contact us now and receive 1 free consultation.