If you are trying to obtain financing, either for a personal or business loan, chances are you will need to submit your tax returns for the last 2-3 years.
If you have a job and most of your income is coming from your employment, the bank will also ask for proof of income such as your pay-stub.
If you have a business as a sole proprietor or a corporation and most of your income is business income, the tax return is vital for getting approved for a loan.
Filing your taxes promptly and correctly will increase the changes of obtaining that loan you need. Often, you also need to have financial statements which corroborate the tax filings. Having your books organized and accounting done correctly will also increase the changes of obtaining financing and capitalize on opportunities that present themselves.
Everything starts with having a qualified accountant that knows how to keep your books organized but also working with a qualified tax accountant that knows how to prepare your taxes correctly and performs tax planning that meets your business needs.
Tax planning for future needs to meet business needs …Ana
All business owners want to maximize deductions to reduce tax liability. However, when it comes time to request a loan for expansion or financing the purchase of assets, the higher your net income the higher the chances you have of obtaining a loan. So, how do you maximize both deductions and net income?
The answer is to have a good tax strategy or plan that meets your business needs in the future. It is important to know the difference between tax preparation and tax planning. Tax planning involves what needs to be done in the future in order to meet your business needs. Tax preparation is about reporting what already happened in the past. Therefore, there isn’t much that can be done by April 15th for the previous year. What’s done is done. The sooner you work on a tax plan, the better you will meet your future financial and or business goals.