The most common mistakes we see are:

1)      Most businesses are not in the correct legal entity for optimal tax strategy. Many chose their strategy only from a legal point of view.

2)      Business owners wait for the tax professional to notify you of your tax obligations. In most cases, you have to ask.

3)      Entrepreneurs think that tax preparers have reviewed their books for accuracy. This is not their job and if you read your engagement letters closely, you may notice that they require you to assert to the accuracy of the numbers you are presenting.

4)      Most wait until the end of the year to prepare taxes after the year is already done, and do not plan for the upcoming year.

5)      Entrepreneurs do not take responsibility for their tax obligation and think that by hiring a tax professional there is nothing else to do. The responsibility and ownership of business taxes remains with the business and its owners. Tax professionals are advisors and preparers, not owners.

6)      For those who do plan, most only plan for income tax, and miss requirements for other tax types in the business.

7)      Owners use tax professionals for all of their accounting needs. It is like using a chiropractor to deliver a baby. Most do not know how to best leverage their financial professionals to get the best service and advice. Businesses need both a financial accountant (help owners use financials for day-to-day business operations) AND a tax accountant (help owners use financials for opportunities to strategically reduce tax liability.)