What to Do If You Can't Afford Your Online Merchant Tax Bill
Finding the money to pay your business taxes each year can be difficult if you're a small online business without a large amount of cash flow to work with. When you find yourself staring at a number on your tax forms that seems impossible to pay down, here are the steps you should take.
Double Check Everything
The first thing to do is make sure that all of your numbers are correct. Do a simple scan to see if any figures look out of place. If you have a bookkeeper, have them compare your tax returns to last year's returns to see if anything looks unusual. Check to ensure that you've included all totals that could reduce your tax amounts, including any quarterly tax payments you've made.
Research Possible Discounts
There may have been some discounts that you missed when filling out your tax forms. Now is the time to do some research online and figure out what other discounts and deductibles your business could take to reduce the bill.
Hire a Specialist
After you've taken a look at your taxes and attempted to reduce your total bill, it's still helpful to consult a specialist who can try to look for additional mistakes or tax breaks for your business taxes. A tax reduction specialist is one type of consultant with specific knowledge of how to alleviate tax burdens on businesses. But a great accountant can also work as a consultant to help you with taxes. Often, the price of your consultation will be returned several-fold in the form of a lighter tax bill, plus new knowledge of the discounts that your business is eligible for in the future.
File Your Taxes by the Deadline
Finally, even if you can't afford to pay your tax bill in full, it's important to at least file your business and personal taxes by the deadline. There is an additional penalty for anyone who fails to file their taxes by the initial deadline.
Make a payment on the tax day, even if it's not the full amount you owe. The IRS assesses penalties for every month of nonpayment, and it's based on a percentage of the amount still owed. If you can at least pay down part of your tax bill up front, you'll be able to avoid adding those penalties onto your bill.
You can also apply for an IRS payment plan, which helps to reduce the amount of penalties you owe and give you a structured way to pay off the tax amounts.
Get a Cash Advance
An unexpected tax bill can cut into your business' cash flow greatly. Thankfully, there are cash advances for merchants that can keep you on your feet while you struggle through a difficult tax season; that may be what it takes to keep your shelves fully stocked in a financial pinch.