Tax season can be overwhelming for business owners — especially if you’re juggling daily operations while trying to stay compliant with federal and South Carolina tax laws. If you’re searching for a small business accountant in Conway, SC or need help with business tax preparation in Conway, avoiding common mistakes can save you thousands.

At Peavy and Associates, we help small businesses throughout Conway, Myrtle Beach, and Horry County stay organized, compliant, and financially efficient during tax season and year-round.

Here are seven common small business tax mistakes that could be costing you money.

1. Mixing Personal and Business Expenses

One of the most common errors we see is blending personal and business finances. Without a dedicated business bank account and credit card, tracking deductible expenses becomes difficult — and risky.

Why it matters:

• Increases audit risk
• Causes missed deductions
• Creates bookkeeping confusion

A Conway, SC CPA can help you structure your accounts properly and keep clean records.

2. Missing Legitimate Business Deductions

Many business owners don’t realize how many expenses are deductible. Commonly missed deductions include:

• Business mileage
• Home office expenses
• Software subscriptions
• Marketing and advertising costs
• Professional services
• Equipment purchases

Working with a small business accountant in Conway, SC ensures you capture every eligible deduction under both IRS and South Carolina guidelines.

3. Filing 1099s Incorrectly

If you hire independent contractors, you’re responsible for issuing 1099 forms accurately and on time. Common mistakes include:

• Misclassifying workers (1099 vs. W-2)
• Missing filing deadlines
• Reporting incorrect payment amounts

Penalties for misclassification can be significant. Peavy and Associates helps Conway business owners stay compliant with federal and state regulations.

4. Ignoring Quarterly Estimated Taxes

Self-employed individuals and business owners in South Carolina are typically required to make quarterly estimated tax payments.

Missing these payments can result in:

• IRS penalties
• Interest charges
• Large unexpected tax bills

A proactive CPA in Conway, SC can calculate and schedule estimated payments to prevent surprises.

5. Poor Bookkeeping Throughout the Year

Waiting until February or March to organize receipts is stressful — and often inaccurate.

Poor bookkeeping can lead to:

• Missed deductions
• Incorrect reporting
• Cash flow confusion

Peavy and Associates offers bookkeeping services in Conway, SC to keep your financial records organized year-round, not just at tax time.

6. Overlooking South Carolina Tax Requirements

South Carolina businesses must comply with state-specific rules, including:

• Sales tax filings
• Employer withholding
• State income tax reporting

Online tax software often doesn’t account for local nuances. Working with a local Conway accounting firm ensures compliance with the South Carolina Department of Revenue.

7. Trying to Do Everything Yourself

DIY tax software may seem cost-effective, but small business taxes are complex. Without expert guidance, you may:

• Overpay in taxes
• Miss deductions
• Trigger audits
• Make costly filing errors

Hiring a small business CPA in Conway, SC provides personalized strategy, compliance support, and peace of mind.

Why Choose Peavy and Associates for Business Tax Preparation in Conway, SC?

At Peavy and Associates, we provide:

• Small business tax preparation
• Bookkeeping services
• Payroll support
• Tax planning strategies
• Year-round advisory services

We proudly support businesses throughout Conway, Myrtle Beach, and Horry County with proactive, personalized accounting solutions.

Schedule Your Small Business Tax Consultation Today

Tax season is the perfect time to evaluate your financial systems and ensure you’re not leaving money on the table.

📅 Looking for a trusted small business accountant in Conway, SC? Contact Peavy and Associates today to schedule your business tax preparation appointment before the filing deadline.

By Peavy and Associates | Conway, South Carolina

Tax season isn’t just about filing returns — it’s about planning ahead. January is the ideal time for business owners to evaluate their finances, adjust strategies, and take proactive steps to reduce tax liability throughout the year.

At Peavy and Associates, we work with businesses across Conway, SC to implement smart, year-round tax planning strategies that support growth, compliance, and long-term success. Here’s how starting now can make a meaningful difference.

Why Tax Planning Should Start in January

Waiting until tax deadlines approach limits your options. Proactive planning in January allows you to:

• Identify tax-saving opportunities early
• Adjust business strategies before year-end
• Avoid surprises at filing time
• Improve cash flow throughout the year

Effective tax planning is about control and foresight, not last-minute fixes.

1. Review Your Business Structure

Your business entity — LLC, S-Corp, C-Corp, or sole proprietorship — impacts how much tax you pay.

January is a good time to review:

• Whether your current structure is still the most tax-efficient
• Salary vs. distribution strategies (for S-Corps)
• Changes in income or growth that may warrant restructuring

A review with a professional accountant can reveal opportunities for savings and compliance improvements.

2. Plan for Estimated Tax Payments

Many business owners are caught off guard by quarterly estimated tax payments.

In January, you should:

• Review last year’s tax liability
• Estimate income for the upcoming year
• Adjust quarterly payments accordingly

Proper planning helps avoid underpayment penalties and keeps cash flow predictable.

3. Take Advantage of Deductions and Credits

Tax laws change frequently, and many deductions or credits are overlooked.

Common opportunities include:

• Equipment and asset depreciation
• Home office deductions
• Vehicle and mileage expenses
• Retirement plan contributions
• Industry-specific tax credits

At Peavy and Associates, we help Conway business owners identify and maximize deductions they qualify for — not just at filing time, but throughout the year.

4. Align Your Accounting and Tax Strategy

Accurate bookkeeping is essential for effective tax planning. January is the time to ensure your financial records are:

• Organized and up to date
• Categorized correctly
• Aligned with your tax strategy

Clean books lead to better financial decisions and fewer surprises.

5. Set Financial and Tax Goals for the Year

Tax planning should support your broader business goals.

In January, consider:

• Revenue growth targets
• Planned investments or expansion
• Hiring or payroll changes
• Retirement or succession planning

Your tax strategy should evolve with your business — not work against it.

How Peavy and Associates Supports Year-Round Tax Planning

As a trusted accounting firm in Conway, South Carolina, Peavy and Associates offers proactive tax planning tailored to your business.

Our services include:

• Strategic tax planning and consulting
• Business tax preparation
• Bookkeeping and financial reporting
• Payroll and compliance support

We partner with clients to make informed decisions that drive long-term success.

Start the Year with a Smarter Tax Strategy

January is the best time to take control of your tax planning — not after the year is over.

👉 Contact Peavy and Associates today to schedule a tax planning consultation and position your business for a successful year ahead.

Teens work a variety of jobs for extra money, they may be employed in the family business, or have unearned income from interest or dividends. In 2022, any child that earned $1,150 or more in unearned income is required to file a return. Tax laws surrounding teens, their income, and the type of income are complex. If in doubt, it’s best to hire a tax professional.

Earned Income

Anyone earning $12,550 or more is required to file a federal tax return and that includes teens. A minor that earns $400 or more in wages or tips working full- or part-time must file a tax return. Even if the teen isn’t required to file a return, it’s a good idea to do so if the employer withheld federal income tax from earnings.

Dependents

However, there are some important elements attached to the question of teen tax returns. It will depend on if the teen is 19 or younger, age 24 and a student, or permanently disabled. Another consideration is if the parent provided 50 percent or more of their support and how many months of the year the teen lived with their parent. If any of those situations apply, the teen may still qualify as a dependent.

Unearned Income

A teen that qualifies as a dependent and has unearned income of more than $1,100 must file a return. However, if the teen only had unearned income, parents may be able to include that income on their own tax return. The disadvantage is that it might propel parents into a higher tax bracket.

Earned & Unearned

Teens that have both earned and unearned income, will need to file their own return if they have more than $1,100 of unearned income, over $12,550 in earned income, or if the combined total is the larger of $1,100 or earned income of up to $12,200 plus $350.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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The answer is no. In fact, the opposite is true. Single people are taxed at a higher rate than a married couple that file jointly. It’s essentially a penalty for being single. It’s not just something that affects people who are single by choice – it also impacts individuals who are divorced or lose a spouse through death.

Singles pay more over their lifetime in taxes, receive less in Social Security benefits than their married counterparts, and don’t have the luxury of two incomes to pay for life’s necessities or to create a retirement fund. The inequality affects women more than men.

The state of your finances is your responsibility. Diligence in managing, planning and saving for your future is critical at every stage of your life. You’ll need to factor in your Social Security benefits, pensions and other sources of income for retirement.

Don’t let a spouse or partner control your finances without your input. Enlist a financial advisor or accountant to help you identify tax strategies and other means of maximizing your money.

Single people are charged a higher rate on their income taxes than married couples. Child-focused policies are written in favor of married couples and don’t consider single parents. The tax structure in the U.S. also favors couples at upper income levels.

High-income couples have access to shelters, credits and deductions that singles and lower-income people don’t. Tax laws are written with the traditional nuclear family in mind and don’t account for modern family units and living arrangements.

The more people make, the more they’re taxed as they enter higher tax brackets. Couples receive the same amount of tax breaks for both people, even if only one person is working. That’s not true for single people The current system is designed in such a way that a married couple pays less in taxes than 2 unmarried people filing individually.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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A wide variety of grants are available for education, research, business, municipal, and even home projects. Whether the funds are taxable or not will depend on the type of grant received and the purpose for which its intended.

The funds may be distributed under the auspices of a grant, emergency relief funds, a stipend or a variety of other names. It can be a one-time payment or made through recurring payments. A grant can be in the form of cash, supplies or equipment.

Education

Grants and scholarships are not taxable, providing the money is used for study or research for a degree. The funds must be spent at an eligible educational institution.

Business

Grants for business purposes are taxed by the IRS as income, regardless of its source. Depending upon the state in which the business is located, owners may also be required to report grant funds as income on their state income tax returns. Some grants are only allowed to be used for very specific purposes.

Home

Programs are available for projects ranging from home repairs for low-income families to those for installing eco-friendly solutions that protect and preserve natural resources.

Reporting

A schedule C should be completed for grant money. The benefit of claiming it as income is that it will usually be taxed at no more than 30 to 40 percent on federal or state income tax returns. Even if a state says the grant is tax-free, it will still be subject to federal taxes, Social Security and Medicare taxes.

In some instances, recipients must prove what the grant was spent on or what was purchased. No matter how it’s distributed, the source, its intended purpose, or if it’s in the form of cash, equipment or supplies, recipients are better off financially if they report it as income. It will be considered revenue by the IRS.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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There’s some confusion for some about what the capital gains tax is, especially if they’ve sold an asset or they’re new to trading. It’s a tax that’s levied on the profit an individual makes when they sell an asset or investment. The asset can range from real estate to stocks and bonds. The amount of tax is determined by how much the asset has appreciated in value during the time it was held by the owner.

The rate of tax is also dependent on the filer’s income bracket. The tax can range from 0% to 15% or 20%. A long-term capital gains tax is assessed if an individual has owned the asset for a year or more. Short-term capital gains taxes will apply if the investment has been owned for less than a year and will be taxed according to the individual’s normal tax rate.

Unrealized capital gains refer to unsold investments. It doesn’t matter how much in assets an individual has, how long they’re held, or how much they’ve increased in value. Purchasing or investing in an asset and keeping it over the long term is a way of building wealth that can be passed on to heirs.

Maximizing profitability and minimizing capital gain taxes requires careful, well-though out strategies. For tax purposes, a purchased asset is typically treated the same as if was a salary or wages. The same is true of dividends derived from an asset.

An increasing number of people are using software applications to trade online. The thrill of buying and selling can override any benefits if they’re not aware of the capital gains taxes they’ll have to pay or if they don’t understand IRS laws.

However, taxable gains can be offset by capital losses. A maximum tax of $3,000 per year is levied on net losses. Leftover losses can be carried forward into following tax years.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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The Office of Management and Budget reports that between 2010 and 2018, the wealthy paid an average of 8.2 percent of their income from their wealth, and a large part of their wealth went untaxed. There are 22 different tax brackets in 2022, with the highest rate at 37 percent, making the taxation system confusing at best.

That estimate is at odds with millionaire Warren Buffett’s statement in 2013, who famously said he pays lower taxes than his secretary. The wealthy pay less in taxes for multiple reasons. The first is that their income is derived from dividends, stocks, and capital gains from investments, rather than wages, that are taxed at a lower rate of 20 percent.

Additionally, a tax code feature called “stepped up basis,” says gains on an asset is never subject to income tax if an asset isn’t sold during the owner’s lifetime. That continues when the wealthy pass it on to their heirs.

That means that a significant amount of the wealthy’s income will never appear on their income tax return. A study by the White House in Sept. 2021 showed that the wealthy paid an average of 8.2 percent in actual taxes, while the typical middle-class family paid 13.3 percent.

Taxes are just one component of a highly complicated and complex tax code that enables the ultra-rich to pay a small fraction of taxes on their actual wealth. They use legal loopholes that includes depreciation, hiring their children, deducting business expenses, and rolling forward business losses.

Other legal methods of avoiding income taxes are deducting interest payments on debt, claiming investment losses, and like-kind exchanges of property. The wealthy also claim a deduction when they transfer money to their own philanthropic foundations.

For millions of Americans, the avenues used by the wealthy aren’t available to the average taxpayer. It’s also interesting to note that in the 1950s and 1960s, the federal income tax rate was 91 percent for the wealthy, down from 94 percent in 1944-1945. The tax rate for the wealthy has steadily been decreasing since then.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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Not to be confused with interest rates on a mortgage or ongoing property taxes to be paid each year, a mortgage recording tax is used to document a loan transaction. It’s a fee that’s paid when someone takes out a mortgage. There are currently eight states that charge a mortgage tax and one of those is Florida. Numerous lending institutions offer online mortgage tax calculators that perform the financial calculations.

Individuals can do the math themselves by taking the total amount being borrowed and dividing it by 100. Then round up that number to the nearest whole number. Local laws may allow for a deduction to reduce the amount.

Florida residents pay 35 cents per $100, based on the amount of debt being incurred on the mortgage. However, that amount can vary among counties and a surtax may also apply. It’s customary for the seller to pay the tax, though that isn’t a mandate. The real estate agent is responsible for securing a check for the amount before the deed is recorded.

Failure to pay the amount promptly can result in the state assessing a monthly penalty fee. A floating interest rate may also be placed on any unpaid document. Parties exempt from the tax include state and federal government agencies, political subdivisions, and Florida counties and municipalities. When an entity is exempt from the tax, the other party must pay it.

Many types of deeds require this documentation, including warranty and quit claim deeds, easements, and contracts for mineral, timber, gas and oil rights. A mortgage tax is also collected if an individual refinances. However, a mortgage reassignment can transfer the original mortgage tax to the new lender. Not all lending institutions will do this, but if the lender agrees to do so, it can save individuals a significant amount of money.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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One of the biggest misconceptions about filing an extension on federal tax returns is that it means individuals don’t have to pay any amount owed on time. An extension gives people more time to file, but not more time to pay.

Individuals can file an extension on their federal taxes, but it has to be done before the last day for filing the taxes. An extension provides taxpayers with additional months to prepare and file their return for any reason. The IRS automatically grants a request for an extension, but the proper forms must be filed and the extension is valid until Oct. 15. The extension can be filed electronically.

Taxpayers are expected to pay the full amount they owe by the tax deadline, even if they file an extension. The IRS assesses a penalty for late payments, usually 0.5 percent per month of the balance that’s due, but failing to pay can increase that penalty to a maximum of 25 percent.

There are 3 primary reasons that individuals file an extension. The first is missing or inaccurate information. Many people find that they haven’t received a form they need in time to file.

The second most common reason for an extension is that a taxpayer will be out of town during tax season. Many people from northern states winter in the south, while others choose to vacation during spring break. If they anticipate a refund, they often file an extension.

Lastly, people run out of time. Filing federal taxes can be stressful, leading to procrastination. Despite taxes being due on or near the same date every year, some individuals lose track of time, simply get busy, or find themselves dealing with a major life event.

For those that don’t have the money to pay their tax bill in full, the IRS offers some payment plans. Individuals will still have to pay their tax bill, along with any applicable penalties and interest, but at a lower rate. Installment agreements are also available, in which individuals pay a set amount each month. The IRS advises individuals pay their tax burden with a credit card or take out a loan to save money.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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There are some very good reasons to adjust your withholdings on your W-4. The form tells your employer how much money to keep out of your check for federal income tax. It will have an effect on your tax liability and prevent you from receiving an unexpected tax bill when filing your federal return.

Your W-4 is also critical for preventing a penalty for underpayment. Some people choose to claim every possible withholding, essentially living on less throughout the year to obtain a large refund at tax time. The IRS wants you to reduce your tax bill and have a refund that’s as close to zero as possible.

Life Events

Any time that your life circumstances change, you should complete a new W-4 with your employer. That includes a marriage, divorce or the birth or adoption of a child. Major life events also include buying a house, getting a raise, and contributing to educational funds. Some of those changes will make you eligible for credits on your federal tax return.

Part-Time Employment

If you normally work all year, but get laid off or experience downtime, you’ll need to adjust your withholding to account for those changing circumstances.

Second Job

It doesn’t matter whether you get a part-time job, work the gig economy, run a side hustle, or have a home business, you’ll need to adjust your withholding. There are a great many types of income producing ventures that are viewed as self-employment by the IRS, which makes you liable for income tax on the amount, along with the self-employment tax, Social Security and Medicare.

Spousal Employment

If your spouse gets a new job or changes jobs, they’ll also have to complete a W-4. Any change in income – an increase or a decrease – will have an impact on your income and amount of taxes you owe. Couples need to use both incomes and approximate as closely as possible what they need to claim on their W-4.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

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