TAX NEWS - 2010

Collect Your Property Income and Investor Information For Taxes

Principal, investors, and managers have a legal obligation to complete the properties taxes. The process may seem more daunting the task actually is. The information required to complete your taxes includes:

- Company information,
- Investor information,
- Vendor and service provider information,
- Transaction information

Discussing each, we'll break down the details quickly.

In all cases, you should have last years state and federal tax document including the 1065 and K1s.

For company information, the information required is tax Id number, date of formation, state of formation, state tax id, and address (note if the address has changed you need to complete an 8822 change of address form). You also need to know the primary state where commercial activity occurred. State taxes need to be completed for the state where activity occurred and (if different) for the state of formation.

For investor information, the information required is tax id number, address, percentage ownership, date of investment, last years capital account, and this years capital account. If investors have different distributions based on some other criteria, you need to have this information available.

For each vendor with whom you conducted $600 or more business, you need the total business expenses or payments, tax id, and address.

For the business, you should have a record of all transactions completed via check, electronic funds transfer, wire transfer, or cash, the date, and the type of transaction. You will want to note each capital transaction and to know the depreciation schedule that will apply. You should have loan documents and loan transaction settlement sheets. You should have all purchase contracts and settlement sheets. If you have transactions eligible for tax credits, you need the documents from those transactions and the tax credit forms.

You should have all payroll and property tax documents available for the company.

Once this information is collected, you are prepared to complete your taxes.

Next, you need to be aware of when all items should be completed. The requirements are as follows:

1099s for vendors are due by the close of January. W2 are due to employees by the close of January. K1s are due by March15th generally and federal taxes are due by April 15th. Many states vary and usually fall on either May 1 or May 15. You will need to verify the due date for each state you are filing under. For state taxes, the submission documents vary. Some have their own form and some require the K1. Some states require the state to only submit their form and others require the federal K1 along with their form.

An automatic extension can be completed for all entities. The extension does not forgive taxes that are due and the company is required to estimate taxes and make this payment on the original due date.

This does not take the place of an accountant and the rules may vary somewhat and overtime some points here may be erronious. However, if a company puts together the information outlined in the groups outlined, with detailed dates, etc. An accountant or tax preparer can prepare accurate taxes even for significant activities in only a few days. even in the absence of a company internal set of finance statements.