Is it wise to use free business tax software just to save money or time? Keep in mind most small businesses, especially start-ups, have many tax breaks that can end up saving you a lot of money. After all, aren’t we in business to make money? Part of making money is also saving it. Nevertheless, if you are dead set on trying to find a free version to do your business taxes, please go into it with both eyes open. Simple things like whether your business is a Sole Proprietorship or and LLC can make a difference on the federal tax form you must use.
FreeTaxUSA is one free version for a federal return, but there is a charge for the state return. Although I have never used their free business tax software it appears to have enough choices to file a return. It has been approved by the Internal Revenue Service; however, the claim isn’t specific to say it’s for small businesses or just a general claim to include personal income tax returns also. The specific claim states that they have filed over forty-three-million tax returns with the Internal Revenue Service. It goes on to state that they help with Self-Employed Taxes, promising to help you with finding all the deductions and write-offs you deserve.
Please keep in mind I am not here to endorse, recommend, or sell any specific business tax software. My intent is to provide you with information and then leaving up to you to make a wise choice on whether to use a free business tax software or not.
Having said that, remember there are plenty of write-offs for any type of small business, whether you run it out of your home or have a concrete and mortar building you work out of. Just to give you a sample of the type of things you can write off as expenses, which in turn reduces your tax burden, is: fees paid for accounting, fees paid for advertising, bank expenses, expenses for sales or commissions, consulting fees, training expenses related to the business, expenses incurred to collect on a debt, insurance, company vehicle(s), inventory, staff wages, office expenses, and the list goes on and on.
The point I am trying to make by providing this short list of business type expenses is that most free business tax software is really just trying to get you to buy their more advanced and detailed version that will cost you money, and by the way is a tax write off. You have worked very hard to start your business and have already invested a great deal of money into it, not including a lot of sweat.
Even though the free software may have all the available deductions / write-offs included they may not offer all the instructions or suggestions associated with them. As an example, they may suggest you fill in the blank for the amount money you spent for advertising your business, but do not offer suggestions on types of advertisements. By offering all the various types of advertising a business may incur it will help you not to forget where you might have spent your money. In addition, it may warn you against including something you might think is okay, but because of changes in the law they may not be.
So again, think it through before you decide to use a free tax software just to save a few dollars. It may end up costing you hundreds instead by not including every single deduction you are legally eligible for. Don’t cheat yourself!
Thank you and may God bless you.