Right now, the COVID-19 pandemic has put the business world at a standstill. However, this will not stop local, state and federal authorities from collecting their taxes. Therefore, it is important to understand how COVID-19 is impacting your business during tax season.
Right now, there have been a number of rule changes to tax season because of the COVID-19 pandemic. These rule changes are designed to make it easier for businesses to handle tax payments and tax reporting. It is important that you begin taking the right steps to deal with the COVID-19 related tax changes.
5 ways Covid-19 may impact your business during tax season
1). You may not be able to pay your monthly, quarterly or annual tax
Don’t worry. Many businesses are impacted by the Covid-19 pandemic and just about all revenue offices are offering some sort of tax relief. Make sure that you can pay what you can to show “good faith” that you are trying to pay your tax.
2). Communications with revenue offices may take longer than usual
Just like any other office, the IRS and other tax revenue offices may be operating with a lighter staff. That means it may take longer to receive customer service or get anyone on the phone.
3). Tax preparers may be more busy than usual
Because of the unusual situation related to the Covid-19 pandemic and the continuing changes in tax rules, your tax preparer may take longer than usual to work on your documents. You will want to factor in the extra time needed for your tax preparer.
4). You may qualify for extra deductions
Chances are that your business was negatively impacted by the Covid-19 pandemic. Therefore, you will want to know what special deductions you can take in order to lower your tax. Make sure you disclose as much as you can to your tax preparer to take advantage of as many deductions as possible.
Steps you can take right now
1). Organize your documents
Just like any other tax season, you will want to make sure that you have all the documents that you need. That includes sales receipts and other important financial information that you can send to your tax preparer.
2). Check for any COVID-19 rule changes from local, state and federal revenue entities
Because of the Covid-19 pandemic, just about all revenue departments have delayed filing dates or made changes to their operations. It is important that you are aware of these changes. For instance, you will want to know the new tax deadline for filing your paperwork. Also, you will want to know if various revenue offices have changed their hours of operations.
3). Talk to a sales tax consultant
It is critical that you talk to a business tax consultant. These professionals are up to date on all of the Covid-19 related changes during tax season. They can recommend the best approach that will minimize your financial impact during this unusual tax season; and a sales tax consultant will be able to give you the answers and strategy your business needs to make pricing decisions in tis weird economic time.
4). Know how much you can pay and when
While filing dates may have been pushed back, you may still have to pay your tax. Therefore, you will want to know how much you need to pay and when. Your tax preparer should provide you with that information well before the tax payment deadline.
5). Seek tax relief
Currently, the IRS is offering some form of tax relief for both individual and business filers. You will want to be aware of what tax relief is available. Also, check with local and state revenue offices to see if they are also offering any form of tax relief.
Summing up tax season during the Covid-19 pandemic
This is one of the most usual tax seasons ever for businesses. Therefore, you will want to be aware of all the changes when it comes to tax deadlines, tax preparation and tax rules. Be sure to have a top business tax consultant and tax preparer working for you during these challenging times. Finally, try to take advantage of any pandemic related tax relief from all revenue offices. With the right information, your business will be able to expertly deal with tax season during the Covid-19 pandemic.