Things You'll Need:
- Business Accounting Software
- Tax Preparation Forms
- Tax Preparation Software (optional)
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Step 1
Maintain accurate and organized records. No matter which accounting method your business uses, it is important to keep accurate and organized records. It makes it easier to complete the appropriate tax forms and justify your deductions in the event of an audit.
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Step 2
Determine the year in which the income and expense accrued. The accrual accounting method for filing taxes means that you report your income and expenses at the time earned or realized. If, for instance, your contracting business worked on and completed a job in December, the income/expenses are considered earned in December. Although your business did not receive payment for the job until the following year, it accrued the income/expense in December.
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Step 3
Obtain a copy of the necessary tax forms and instructions. Once you’ve squared away the income/expenses using the accrual accounting it’s important to obtain a copy of the appropriate tax reporting forms. You may obtain the forms by downloading them from the IRS website.
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Step 4
Purchase tax preparation software. An easier way to complete your business taxes is to purchase one of the popular tax preparation software programs. Not only do they offer assistance in the tax preparation process, the software checks for the latest IRS revisions to ensure that your taxes comply with the latest changes.
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Step 5
Complete and submit the tax forms along with payment prior to the tax due date.
