A Tax Consultant for All Seasons

If you are getting ready to close your business, it is not as simple as turning out the lights and closing the door. The IRS provides a checklist of items you need to be sure you have taken care of to be sure you don’t incur penalties for items you may not have realized you need to do.  One of the main things you have to be sure to do is to file all income tax forms to stop the filing requirement for your business. That also is true if you have employees. Be sure you have filed all tax forms to stop the filing requirements for payroll taxes as well. Closing your company does not stop these requirements.  You must file final forms (there is a box on most forms to check if this is your final return) to stop the filing requirement.

If you have a retirement plan, you have to complete the correct forms an be sure you have followed all the steps necessary to terminate the plan.  Follow the previous link to get the forms and instructions you may need to terminate your retirement plan.

Be aware your state may also have requirements and you may need to notify the Secretary of State in your state of the closing. Regulations vary by state so your state Department of Revenue or the Secretary of State office should have the information you need.

Be sure you retain your business records for 7 years in case a tax return you filed for the business is audited. The IRS can go back 10 years, but rarely goes back more than 7 unless fraud is suspected.

Depending on the complexity of your business, it may be wise to contact an attorney and/or a tax professional.

This entry was posted on Tuesday, April 29th, 2008 at 18:42 and is filed under Small Business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.