Taxes

IRS enforcement is on the rise

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Here’s how to stay prepared year-round.

Image from the website of Congresswoman Lauren Boebert

by Milly Pyne

As the end of the financial year approaches, businesses across the US are diligently gathering documents and organizing expenses to ensure IRS compliance. Enforcement efforts are particularly strict this tax filing season, heightened by the IRS’s intensified enforcement efforts which now target 125,000 cases of unfiled tax returns.1

To alleviate the stress of tax filing, Business admin experts at Vera have shared their advice on how to streamline the tax filing process and navigate the busy tax season more effectively.

10 tasks to do all year round to speed up business tax filing season

Tax season is often a time of high stress and urgency for businesses, but with consistent attention to key tasks throughout the year, it doesn’t need to be. By incorporating AI tools into a proactive approach to tax management, businesses can streamline the filing process even further, improving accuracy, minimizing the risk of financial errors, and ensuring that all available deductions and credits are identified and maximized.

These year-round strategies contribute to long-term financial stability, help businesses stay compliant with IRS requirements, and reduce the pressure of last-minute filings. Beyond compliance, effective tax planning combined with AI insights becomes a strategic growth tool, positioning businesses for sustained financial health and success in a competitive landscape.

  1. Maintain accurate and updated records

Maintaining accurate and up-to-date financial records is essential for a smooth tax filing process. By consistently recording all income, expenses, and receipts throughout the year, businesses can not only avoid the last-minute rush to organize their financial data but also ensure that every detail is accounted for. 

This ongoing diligence helps to prevent any critical information from being overlooked, ultimately leading to more accurate tax returns and reducing the risk of errors or missed deductions when it’s time to file. Additionally, well-maintained records can streamline other financial processes, contributing to overall business efficiency.

  1. Automate payroll processes

Automating payroll processes ensures that employee taxes, including federal income tax and Social Security contributions, are accurately calculated and submitted on time. This minimizes the risk of errors and potential penalties from the IRS and saves businesses valuable time and resources. 

By streamlining payroll through automation and AI tools, companies can reduce administrative burdens, allowing them to concentrate on other critical aspects of their operations. In turn, this enhances overall efficiency and ensures compliance with tax regulations, while contributing to smoother financial management. There are many AI tools that can help organize this task, such as Vera, saving you time and effort in the long run.

  1. Review expenses monthly

Regularly reviewing expenses is key to effective tax management. With the help of AI tools that categorize and track expenses in real time, businesses can ensure each item is properly recorded for tax purposes. AI can also detect patterns and anomalies, ensuring that all allowable expenses are identified and claimed correctly, maximizing tax deductions and simplifying the end-of-year reconciliation process.

This proactive approach not only helps prevent confusion at tax time but also maximizes potential tax deductions by ensuring that all allowable expenses are correctly identified and claimed. 

  1. Track mileage and travel expenses

For businesses with substantial travel activities, tracking mileage and travel-related expenses in real-time is crucial. Using apps or spreadsheets to record these details ensures precision and reliability, using AI tools, you can automatically track these details with precision, making it easier to claim deductions and reduce taxable income. This approach not only facilitates the accurate claiming of allowable deductions but also helps in effectively reducing taxable income. 

  1. Consult with a tax advisor quarterly

Regular consultations with a tax advisor are instrumental in keeping businesses well-informed about any changes in tax legislation and ensuring continuous compliance with IRS requirements. AI-powered financial platforms can complement these consultations by analyzing tax trends and providing predictive insights.

These meetings offer a valuable opportunity to explore potential tax-saving strategies and address any emerging concerns before they develop into more serious issues. By engaging with a tax advisor consistently, businesses can navigate complex tax laws more effectively, stay ahead of regulatory changes, and make informed decisions that enhance their financial health and reduce the risk of costly errors.

  1. Organize receipts and invoices digitally

Digitizing receipts and invoices serves not only as an effective space-saving measure but also guarantees that crucial documents are easily accessible whenever required. Well-organized digital records streamline the tax filing process by providing a clear and efficient way to manage financial documentation. AI-based management systems can automatically categorize, store, and retrieve financial records, significantly simplifying the tax filing process. 

This approach not only simplifies day-to-day record-keeping but also proves invaluable during an IRS audit, where quick access to accurate and complete records can significantly ease the review process and help ensure compliance with tax regulations.

  1. Monitor cash flow regularly

Regular monitoring of cash flow is essential for financial management. By closely tracking cash flow throughout the year, businesses gain valuable insights that enable them to make well-informed decisions and manage their finances more effectively. 

This ensures that businesses maintain adequate funds to meet their tax obligations as they come due, preventing any last-minute financial strains. Additionally, ongoing cash flow analysis helps identify potential financial challenges early, allowing businesses to address issues proactively and maintain overall financial stability.

  1. Reconcile bank statements monthly

Monthly reconciliation of bank statements is a vital practice for ensuring that all transactions are accurately recorded and accounted for. AI-powered accounting software can help match transactions with bank statements, identifying and resolving discrepancies quickly – making the job quicker and easier.

By regularly comparing bank statements with internal records, businesses can promptly identify and resolve any discrepancies, preventing potential issues from escalating. This approach not only reduces the risk of errors in tax filings but also enhances the accuracy and efficiency of the tax submission process. 

  1. Stay updated on tax deadlines

Missing a tax deadline can lead to penalties from the IRS, which can significantly impact a business’s finances. By staying vigilant about all relevant tax deadlines and proactively setting reminders, businesses can ensure they meet their filing and payment obligations on time. 

This not only helps avoid unnecessary fines and interest charges but also adopts better financial planning and reduces the risk of last-minute stress. Timely compliance with tax deadlines ensures smooth operations and helps maintain a positive relationship with the IRS which supports the business’s overall financial health. AI tools can be great for this, as they analyze real-time data to keep you up-to-date on the latest tax rules in your state.

  1. Conduct a year-end review

Conducting a thorough year-end review is essential for businesses to finalize their accounts and prepare all necessary documentation well before the tax filing deadline. This process enables businesses to identify and address any discrepancies or required adjustments, ensuring that their financial records are precise and complete. By examining and verifying account details ahead of time, businesses can enhance the accuracy of their tax return, minimize the risk of errors, and avoid last-minute issues. 

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Categories: Taxes

12 replies »

  2. I’m still waiting for Brain Cina to bust down our front door with a sledgehammer. If he doesn’t have a sledgehammer of his own, I believe his friend Hillary Clinton possesses one – if she’s finished pulverizing all of her computer modems with it, that is.

  3. The IRS should be checking up on all elected officials and their families first, I assume there are plenty of shenanigans to be found……………Let’s start with the Biden’s and the Clinton’s, as they have already gone through Trump’s family underwear drawer……….

    If you’re not on their side politically, you’re an IRS problem and they know who you are !!

  4. Good reason for the Fair Tax, won’t be political. I get their emails, can sign on easily. The US / IRS years ago went to Russia when they wanted to set up a taxing system. Seeing what it entailed, Russia declined.

    • Isn’t this article proof enough illustrating the complexity, stupidity, controlling aspect, of the system. With the ability to tax, your Constitutional rights, political are non- existent. With property taxes, you don’t own your property / land. Dumb bureaucrats are the controllers and your representatives can’t and won’t help you for fear they too will be attacked / scrutinized.

      Trump wants to lower taxes, meaning bureaucrats will have less forms / income for them to put you under the thumb. Tax collection in any from in the US is accomplished by the fear factor. Just to comply is exhausting time and money. You can have 10 CPA’s do your tax filings at the same time, and there will be 10 different results, it;s so complicated. Become an illegal, criminal, street thug, jail bird and they are tax free. For anyone that files correctly, you can become a criminal in their eyes, and be made to look like a criminal even tho they don’t find any problems in an audit.

      Need the Fair Tax and Trump. MAGA and MVRA Make Vermont Real Again.

  5. How were so many people deluded in 1913? Not only was the Federal Reserve established, but tariffs which funded the government were eliminated and the Progressive income tax (16th Amendment) was installed to make sure everybody paid their “fair share”, when in reality they installed a system which they knew down the road could be weaponized and used against political opponents. Then they passed the 17th Amendment allowing the Senators to be elected to office instead of being appointed by the state legislatures bypassing the natural term limits the founders built into Constitution. Right after all the Senators were bought up by the special interests of the day, they turned around and passed laws allowing them to create foundations so they could circumvent the income tax. All this was done under the father of Progressivism, President Woodrow Wilson. And the United States has never been the same. The camel got more than his nose under the tent.

    The only way to stop the federal government from using the present tax system as a weapon is:
    1. Repeal the 16th Amendment. (income tax)
    2. Institiute a National Sales Tax or Flat Percentage Tax. Every citizen has to pay the tax so everyone can complain when they want to raise the tax and vote against the people that want to raise them.
    3. Tax the foundations.
    4. Abolish the IRS. No more power to go after citizens without due process. Make it only a collection agency for the above taxes.

    • In 1913, the Federal Reserve and IRS was voted for bt just a few Congress people on December 24 when most of Congress was at home for the holidays. May all that voted for this crap rot in their graves.

      Prez Andrew Jackson (TN) had two assignation attempts on his life when he got rid of the corrupt bankers in the Federal Reserve. His fame remarks was “I got them before they got me”. Bankers can and are very corrupt, greed is power. In fact history shows US banks backed Hitler.

  6. “Crouch down and lick the hands which feed you. May your chains set lightly upon you, and may posterity forget that ye were our countrymen.” ― Samuel Adams