What to Know About 2022 Tax Season for Business Owners
April 6, 2022
For most small businesses in Texas, 2020 was the year of disruption, 2021 was the year of recovery, and 2022 is the year of getting back on track. This includes tax season 2022, which is back to a normal schedule of tax deadlines and filing dates.
You recall the challenge of keeping up with various changes to tax deadlines during the previous two tax seasons. This year, though, it’s back to normal with a mid-April tax filing deadline for your 2021 tax return if your business follows a certain schedule.
- April 18: Sole proprietorships or independent contractors need to file their 2021 return.
- April 18: C Corps whose fiscal year follows the calendar year schedule need to file.
- March 15: Partnerships or S Corps should have already filed their return by this date or requested an extension.
In addition to being aware of when you need to file your tax return, you should also be aware of what’s new about this year’s tax season.
Things to Be Aware of When Filing Your Business Tax Return
We encourage you to consult with your tax advisor or CPA about questions you may have about specific tax situations that affect your 2021 tax return. The following are some of the main topics to discuss with a tax professional before filing your return.
1. Reduction in COVID tax breaks. Many of the COVID-related economic recovery tax credits that were available to small business owners have expired. However, some businesses still have the ability to claim the Employee Retention Credit. We encourage you to read this article to find out more about this opportunity.
2. Available business credits. The IRS has an official list of business tax credits that could apply to your business. Review the list and discuss with your tax adviser to understand whether you might qualify for some of these credits.
3. Deducting expenses. The IRS released an updated publication covering business expenses. The guide provides clarifications about common business expenses and discusses what is deductible versus not deductible. Included is a commentary on what’s new for the 2021 tax year, including changes to the standard mileage rate.
4. Electronic filing. The IRS is still working through a backlog of tax returns from the past two years due to resource constraints. That’s why the IRS is strongly encouraging taxpayers to use electronic methods of filing a return. And, if your business owes taxes, you can take advantage of the Electronic Federal Tax Payment System (EFTP) to pay taxes through the U.S. Department of Treasury’s electronic system. Discuss with your tax adviser the best method to file your return this year.
5. Be cyber secure! Scammers, hackers, and other cyber attackers are looking for ways to undermine businesses during tax season 2022. The IRS is encouraging taxpayers to remain vigilant against “ongoing scams and schemes” by properly securing devices that are used to support or file a tax return.
According to the IRS, “solid cybersecurity protection and scam recognition is vital to reduce the threat of identity theft inside and outside the tax system.” The IRS released a list of 10 helpful tips to help minimize your exposure to fraud and/or identity theft. Consider discussing the appropriate steps to take with your tax adviser to support security and to avoid theft.
– There could be other topics that you want to discuss with your tax adviser depending on the nature of your business. The IRS has released a thorough publication, Tax Guide for Small Business, that can support your conversations with a tax adviser during tax season.
Have Questions During Tax Season for Your Business?
A lot has changed over the past two years. Make sure you consult with your tax advisor if you have questions about your specific tax situation.
While we are not tax advisors, we certainly appreciate the opportunity to help small business owners across the Texas Gulf Coast. Together, we can help you grow through our provision of business banking services.
Find out more about our services for small businesses. Or, contact us today using the form below to discuss the needs of your small business.