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Paying proper attention to tax issues important when starting a business

A business can be in a vulnerable position as it is just getting started. Financial shocks could imperil a new business’ future survival.

Among the things that could expose a new business to financial shocks are tax problems. When the Internal Revenue Service claims that an entrepreneur made mistakes or acted improperly in relation to tax matters connected to a new business, the new business could be exposed to a range of IRS actions with the potential to impact it considerably financially.

So, it is very important for entrepreneurs to not ignore potential tax problems that come up in connection to their startups. When such problems arise, addressing them proactively could help with trying to minimize their likely overall effect on a new business. Skilled tax attorneys can advise entrepreneurs on what steps they can take to protect their new business in the face of business tax disputes with the IRS.

Among the things that can impact a young business’ likelihood of encountering tax problems is how carefully tax matters were addressed as the business was started. So, there are various tax-related matters it can be important for an entrepreneur to give close attention when starting a business, including:

  • What tax obligations arise in relation to their company. Examples of federal taxes that can come up in connection to businesses include income taxes, employment taxes, self-employment taxes and excise taxes.
  • What steps they can take to make sure they stay in compliance with such obligations.
  • What implications the decisions they make when starting their business have on the company’s tax situation.

Source: Internal Revenue Service, “Starting a Business This Summer? Here’s Four Tax Tips,” Aug. 11, 2017

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