The Ghost of 2013 still lives according to IRS
Two weeks ago we tooted out the old year and toasted in the new one. If we think 2013 is over and can be forgotten, then we have jumped the gun. To the IRS, January 15, 2014, marks the last chance for owners of small businesses to pay their 2013 quarterly tax withholdings.
IRS requires that you withhold an amount equal to the amount of tax paid in 2012 or 90% of your 2013 tax tab. I like the method of using the tax I paid last year. There are so many rules and regulations in exactly guessing what I will owe next April I wouldn’t trust it. I would not choose that unless I had a large change in revenue this year. You will want to look, but remember that cutting it too fine may incur penalties.
Another case of extending 2013 well into the new calendar year is that you have until mid-April to contribute to your IRA. If you have made contributions to your individual 401K as an employee of your business, you have until April to match the workers contributions.
It is probably worth your while to plan your finances now for the year ahead, in particular your contributions toward retirement. If you don’t have a clear strategy, perhaps now is the time to develop one. Social Security, while still valuable to most of us, is not a replacement for a retirement plan. As a business owner, it is all on your shoulders.
If you do establish a plan for yourself and your employees, it is always wise to make sure that it is effective and efficient and that you are executing it well. Sound advice and solid information abounds on line from the most reputable brokers such as Vanguard and Fidelity. Start with their free knowledge.