Taxes can be tough for small business owners

Many small business owners likely need professional help to keep tax issues in order, experts say.
by Brianna Bailey Published: March 6, 2013

“We recommend keeping business and personal expenses separate — even if you are really small,” Rawdon said.

Mixing business and personal expenses can cause problems if a business faces an IRS audit, said Larry Weatherford, public affairs specialist for the Small Business Administration's Oklahoma City office.

“You need to make sure you have good records and notes so you can prove that something is a business expense versus a personal expense,” Weatherford said.

Classifying workers as independent contractors instead of employees to avoid payroll taxes is another audit trap that small businesses often stumble into, he said.

“It's important to understand the difference between an independent contractor and an employee that is under your direction to avoid that problem,” Weatherford said.

Small businesses should also look into what tax credits are available to them, Weatherford said.

For example, small businesses can use a tax credit for 2012 that is part of the Affordable Care act to cover up to 35 percent of worker health care costs, he said. The tax credit increases to up to 50 percent of costs in 2014.


by Brianna Bailey
Business Writer
Brianna Bailey has lived in Idaho, Germany and Southern California, but Oklahoma is her adopted home. She has a bachelor's degree in Journalism from the Univerisity of Oklahoma and has worked at several newspapers in Oklahoma and Southern...
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Information

Small businesses can find more tax help at www.irs.gov/Businesses/Small-Businesses-&-Self-Employed

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