Skip to main content

What Should a Business Tax Plan Include?

Things for Arkansas entrepreneurs to consider

For entrepreneurs and small business owners, the importance of tax planning cannot be overstated. A comprehensive plan can go a long way towards helping to keep your business on stable financial footing. As noted by the Arkansas Department of Finance and Administration, all businesses registered in Arkansas must comply with both federal and state tax regulations. Here are five business tax planning tips to help you get started:

  1. Select the Appropriate Form for Your Business

Business tax planning begins before a company is ever formed. It is imperative that you select the proper legal structure for your business. Different business structures are taxed in different ways. As an example, you may want to operate your company as a pass-through entity, such as a partnership or an LLC. Alternatively, your Arkansas company may work better as a C-corporation. What form works best depends on the finances, the nature of your business operations and your long-term objectives.

  1. Make a Checklist of Business Taxes and Related Costs

To help with tax planning, it is useful to take a comprehensive inventory of exactly what the company might owe in a given year. Indeed, entrepreneurs and small business owners can benefit from creating a checklist of all possible taxes. Among other things, this may include:

  • Business income taxes;
  • Arkansas state taxes;
  • Local taxes;
  • Employment taxes, including self-employment costs; and
  • Business licensing and permitting fees. 

With a detailed checklist of likely taxes and costs, you can get a better idea of what your company might owe to the Internal Revenue Service (IRS), State of Arkansas, or other government entities.

  1. With Business Tax Planning, Timing Matters

One of the most important things that Arkansas business owners should know about tax planning is that timing is everything. Depending on the specific financial circumstances of your business, it may be a sensible strategy to defer revenue until the next tax year or accelerate expenses into this tax year. A tax professional can help you understand the benefits and drawbacks of deferring revenue and/or accelerating expenses.

  1. Create a Plan for Getting Taxes Paid

Business taxes are a significant expense, and even more so if you suddenly find out that your company owes a lot of money. Arkansas businesses should create a thorough plan for satisfying their tax obligations. By doing so, they can better protect themselves from unwelcome surprise bills or major disruptions in tax flow. Be sure to estimate how much your company is going to need to pay over the course of a given year and put money aside, potentially even making estimated tax payments to the IRS.

  1. Be Ready to Consult with an Attorney for Help

Tax planning is complicated. You do not want to leave money on the table—or worse, face sanctions or enforcement action—because of a relatively minor error. Professional guidance is available. If you have questions with business tax planning or need legal support, an experienced Arkansas tax attorney can help. If you want more information on this area of law, see our tax overview.

Other Featured Articles

Business Litigation Icon Business Litigation

What to Expect When You Face an OSHA Violation Claim

Ohio employers need to prepare for the Occupational Safety and Health Review …

Business Litigation Icon Business Litigation

How Does a Firm Decide to Take a Case Pro Bono in Illinois?

And other frequently asked questions about discount legal assistance

Business Litigation Icon Business Litigation

What Can You Argue in a Breach of Agreement or Contract Case?

Sorting out the hearsay in a Tennessee business lawsuit

View More Business Litigation Articles »

Page Generated: 0.14009594917297 sec