4 ways small business owners can help take the pain out of 2018 taxes.
1. Be best friends with your accountant year-round.
Your accountant is actually your business advisor. You don’t have a full-time finance person. You don’t have a CFO. So, they’re the ones advising you about your business financials and the growth of the company. If you’re not already talking to them on a weekly basis, talk to them at least once a month.
2. Streamline your financial data.
The best way to save money for taxes is by hooking up other business applications so you can get that data flowing into a cloud based accounting tool such as Xero. Then, work with your accountant or advisor throughout the entire year to help minimize your taxes, making sure that you have the right deductions all year long. So, by the time you get to the end of the year to file your taxes, it’s painless. It’s seamless.
3. Learn (some) accounting.
You don’t need to be a CPA, but any accounting knowledge you gain now can only benefit you. Ask your accountant questions, learn the ins and outs of your financial statements, and go through your tax forms.
4. Give yourself plenty of time in advance to organize.
Know your filing due dates, and work backwards. Allow time to gather all your documents, especially the paper receipts. Hiring a bookkeeper can also help you organize documents easier, and save you time.
For more helpful tips and resources on small business taxes, check out the related articles below.
PayPal and Xero do not provide tax, legal, or accounting advice. The contents of this site are provided for informational purposes only. You should always obtain independent, professional accounting, financial, and legal advice before making any business decision.
Frequently asked questions.
FATCA affects account holders that are outside the United States, and it requires PayPal to collect tax documents or certifications from account holders stating whether they are US persons. This includes, but is not limited to, business entities, and some individuals that open accounts outside the United States.
Tax Form 1099-K Tips:
- If you feel there is a discrepancy in your tax Form 1099-K, please review your reconciliation report and provide us with the transaction ID(s) in question and the justification for why the transaction is being disputed. Click Contact at the bottom of any page to call or email us.
- How does PayPal report my sales to the IRS? Will I receive a 1099 tax statement?  >
- How do I find my 1099 tax statement in my PayPal account?  >
- How do I download my transaction history?  >
- How do I download my complete transaction history?  >
- How do I change the name on my PayPal Business account?  >
- How do I view or edit my account information?  >
- What is a US person for FATCA and 1099-K tax reporting purposes?
- If there are any discrepancies with your tax identification number and legal name that was used by PayPal for tax Form 1099-K reporting filing with the IRS, you may receive an IRS B-Notice  >
- The B-Notice mailing will provide you with all of the additional information we need from you. >
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- If you received a 1st B-Notice (which happens the first year that the IRS identifies a mismatch in tax identification number/legal name), log in to your PayPal account and follow the Alert Notification to provide the requested information. You may need to download and fill out the IRS tax Form W-9 for PayPal to review.  > >
- If you received a 2nd B-Notice (which happens the second consecutive year that the IRS identifies a mismatch in tax identification number/legal name), you must provide either a copy of your Social Security Card (individuals or sole proprietors) or US IRS tax Letter 147C (entities). Log in to your PayPal account, and go to the Resolution Center to upload the document.  >
- The IRS does not have an online solution for requesting a tax Letter 147 C; the IRS will mail or fax the letter to you. To contact the IRS for a Letter 147C, you should call the IRS's Business and Specialty Tax line at 1-800-829-4933 between 7am and 7pm, local time, Monday through Friday. Requesting a faxed copy may be the quickest manner to get a copy of the tax Letter 147C. You can also view our tax information page for more information.  >
- Fully complete and sign the relevant form and upload it by logging into your PayPal account and following the Notification prompt.  >
- Why did I receive an IRS B-Notice?
- Only impactful for account holders outside of the United States.  >
- PayPal must collect documentation such as certification of non-US status and either a tax Form W-9 for US persons or entities that are subject to US tax, or a tax Form W8BEN/W8BEN-E for non-US persons or entities that are not subject to US tax withholding and reporting.  >
- Most business users who need to provide the requested information will be able to do so by logging into their PayPal account and following the notification prompts.
- What is a US person for FATCA and 1099-K tax reporting purposes?  >
- What does FATCA require PayPal to report?  >
- What is FATCA?  >
- Who is impacted by FATCA?  >
- What FATCA documentation does PayPal collect and how do I provide it?  >
- What happens if I don't provide the FATCA information PayPal requests?  >
- What should I do if my account is limited because I didn't provide the requested FATCA information?
If the discrepancy persist, you may receive an IRS B-Notice later in the year to help you correct the mismatch.
Some common reasons why a TIN may fail verification include:
- Invalid Tax Identification Number (EIN, SSN, iTIN)  >
- The name that appears on your PayPal account does not match with the IRS has on file.  >
- The business name registered onto your PayPal account is different than the legal business name.
Tip: Minor typographical errors with the name (missing period or capitalization) in a business name would not be why there is an IRS mismatch
How do I change the name on my PayPal account?
- Go to payUSAtax.com by April 15 and select Make a Personal Payment.  >
- Select the relevant tax payment category, enter your information, and choose PayPal for payment.  >
- Log in to your PayPal account to confirm your payment and get a confirmation number.
Can I use PayPal Credit to pay my federal income taxes over time?
Yes, qualifying U.S. customers can use PayPal Credit to pay federal income taxes over time to the IRS through payUSAtax.com, on tax payments of $99 or more. If you use this option, the IRS will receive your tax payment right away.
Check the offer’s details, Terms and Conditions here.
If you have any issues with the payUSAtax.com website, please contact them at (855) 508-0159 or by going to the Contact Us section of their website.
- Log in to PayPal Here on your device and navigate to Settings and click Tax.  >
- Set Add Tax to Total to ON.  >
- Ensure that the New (default) tax rate matches the rate of your state.  >
- Click the + icon to add additional tax options.  >
- Initiate a test payment for $1.00.  >
- The tax rate should automatically be added to the total. If you select the tax, additional tax rates should be displayed.