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