The IRS has announced that they will be launching a new online system for filing your taxes in 2021. This means you need to start thinking about how you’re going to file your taxes this year and what it will take to get ready for the future.
The business tax filing deadline 2021 is a topic that has been on many people’s minds. In this article, we will discuss the different ways to file taxes for your business and what you need to know about it.
Tax planning is an important aspect of starting a new company. You’ll be performing a variety of activities, including completing your IRS registration, finding customers, pricing your services, and, most crucially, selecting the appropriate tax software.
You may be tempted to file your taxes using tried and true ways, such as a pre-installed program on your computer. However, given the sensitive information you’ll be managing, a simple software application won’t suffice. Fortunately, tax software companies provide a number of cloud-based alternatives that address the drawbacks of conventional desktop tax filing.
Cloud-based tax software packages may help you automate your tax filing, streamline your accounting, keep track of your tax returns, and safeguard your business from IRS audits. Businesses are aware of these advantages, as shown by their expenditure of $29 billion on cloud services in the first quarter of 2020.
We go through some of the additional features and advantages of cloud-based tax filing software, as well as why it beats conventional local software.
1. There is no requirement for installation.
Every computer or device must have desktop-based tax filing software installed, which is a time-consuming and laborious procedure.
Cloud-based software, on the other hand, allows you to access the program via the internet. As a result, you do not need to install it on your computer in order to use it. Cloud-based tax software becomes immediately accessible for use by eliminating the installation procedure.
2. Data protection
Data security is, understandably, the top worry of any organization in the era of cyber threats. When it comes to your company’s sensitive financial data, data security is even more critical. As a result, while doing taxes online, you’ll need a strong software application to protect you from cyber-threats.
All of your data is stored remotely in a secure data center using cloud-based technologies. Firewalls, antivirus, antimalware, data encryption, and multi-factor authentication are all used by your tax software supplier to keep your data safe. This way, you can be certain that your company’s and customers’ critical data is kept as safe as possible.
3. Increased employee accessibility
Small companies that promote work from home face a barrier since desktop-based tax filing software can only be utilized on office computers. Employees that work remotely, such as tax accountants, must be able to work as effectively as those who work on-site.
Data is stored in cloud storage on distant servers that you may access via the internet. This implies that your workers may use any device to access cloud-based tax software. They don’t have to worry about compatibility since all they need is a high-speed internet connection and a web browser.
CPAs working from home can assist you with your tax and income reporting without a hitch since cloud-based tax filing software can be used from anywhere without sacrificing functionality. This increased accessibility also allows workers and collaborators to achieve a better work-life balance by reducing the amount of time they spend commuting.
Scalability is number four.
Your company will not last indefinitely. All of your company strategies are geared at increasing your reach and client base. Given this, it’s only natural that your tax software keeps up with your company’s evolving requirements.
The majority of desktop-based software is tailored to a particular company size. A change in size necessitates a change in software, putting extra strain on your IT department.
Fortunately, cloud computing technology allows tax and accounting software to grow with your company. When the size of your company changes, you won’t have to go for another cloud-based tax filing solution. You only need to change plans if you want to upgrade or downgrade.
5. Customer service that is available 24 hours a day, 7 days a week
Consider the following scenario: it’s tax season. You’ve gone over the figures with your CPA and are ready to submit your taxes online. Your program stalls and stops functioning just as you’re about to click the “send” button. You don’t have an IT whiz child around to repair the issue, the time for filing your tax returns is coming, and you’re in big danger.
You don’t have to go through this nightmare with cloud-based tax software providers. Customer service is usually available 24 hours a day, seven days a week from most software suppliers. Because the program isn’t restricted to your workplace computer, it’s considerably simpler for support staff to resolve the problem remotely. Small companies may use these tools to submit their taxes on time.
6. Backups that are automated
It’s a demoralizing and unpleasant experience to lose hours of income tax filing labor because you neglected to save your work. Your data is automatically backed up by cloud-based tax software at regular intervals. As a result, all of your information and hard work will remain completely safe.
7. Updates are made automatically.
Software has to be updated on a regular basis in order to address problems or provide new and better functionality. If you use desktop tax software, you’ll have to manually download new versions every time they’re published, which means more work for you and your staff.
You can’t afford to miss these updates, though, since they’re needed for your tax filing software to run more efficiently.
Cloud-based software applications, on the other hand, are updated and fixed automatically at a central server, safeguarding your company from significant IT issues. You may not even notice that the program has been updated in certain instances.
Desktop tax software is often more costly than cloud-based alternatives. These apps often demand exorbitant installation and maintenance costs.
Furthermore, you won’t be able to download the program once and have it replicated for your workers, so you’ll have to pay to have it installed on each computer in your workplace. These issues simply add to a small business’s already skyrocketing expenses.
On the other side, cloud-based tax filing software is nearly always less expensive than desktop versions. Part of this is due to the fact that the creators only produce one version that works on all devices. You may also decide how much you wish to spend in these products since software hosting companies enable you to tailor your payment plans.
9. Integrations that are simple
To keep track of different elements of the business, every firm need numerous software applications. Many of these may be used to the same data collection. Cloud-based tax filing software may readily connect with your current financial management, accounting, and ERP systems in this scenario. This simplifies the process of collecting the information needed to calculate taxes.
To sum it up
Many of the issues that afflict conventional desktop programs may be solved with cloud-based tax software. It’s adaptable, dependable, scalable, cost-effective, and compatible with a variety of devices. As a consequence, any business, large or small, stands to gain significantly by moving their tax filing to the cloud.
TurboTax from Intuit is an excellent example of cloud-based tax software for small company owners. Its user-friendly features and custom-tailored packages make running your company very simple and comfortable. The company’s outstanding customer service is a plus.
The do you have to file taxes your first year in business is a question that many people ask. In order to know whether or not you need to file taxes, it is important to understand the law for your specific situation.
Frequently Asked Questions
What do I need to file taxes for 2021?
You will need to file taxes for 2020 first before you can start filing taxes for 2021.
How much does a small business have to make to file taxes?
A small business is one that has less than $5 million in annual gross receipts.
Can I file business taxes online?
I am not a tax professional, but you can find out more information about filing taxes online by visiting the IRS website.
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