A little while ago, we discussed the importance of getting a Certificate of Good Standing for your business, the process involved, and the advantages. Going beyond that, it is important for businesses to remain in good standing with the IRS, as well, in order to avoid fines, fees, liens, or worse.
Good Standing with the IRS Means Being Pro-Active
A long time ago, staying in good standing with the IRS was a simple as paying your taxes. While paying your business taxes is extremely important, remaining in good standing takes a bit more these days. We now live in an economy and political climate where we do things electronically, and tax laws are subject to change at a faster pace than ever before. Remaining in good standing means taking a pro-active role with finances. For small business owners who are keeping their accounting in-house, this means watching schedules to file business taxes, quarterly 941 forms, and more. Missing any of these can result in a liability and even a garnishment of revenue.
Staying in Touch with Your CPA or Tax Professional
For business owners who use CPAs or tax professionals, you will also need to stay on top of things. Yes, CPAs and tax professionals know what to do with figuring out your business taxes and what you owe to the IRS, but ultimately they are not responsible for getting the ball rolling. Those professionals rely on business owners to get them the reports and numbers they need in order to prepare taxes, so you need to watch your calendar as closely as they do. Work with your CPA or tax professional to have meetings or phone calls regularly. This should be happening anyway to stay on top of accounting and projections, but taxes are important, and should be a two-way street. Set reminders at the end of each quarter so you can file your 941 forms. Remember to get a jump start on business taxes so you can get your deductions filed early. Talk with your CPA or tax professional about new deductions or changes to business tax law. By doing these things, you not only create a stronger relationship and show your CPA and tax professional that you have a vested interest in what you owe, but you will also stay in good standing with the IRS.