Franchise Tax Services

Franchise Tax Preparation & Filing

Franchise Business Tax Preparation and Filing Services CPA in Phoenix, AZ

Tax preparation for small businesses can be complicated and time consuming, especially if you want to make the most of available tax credits and deductions. Business taxes can be especially complicated for franchisees who own many different locations or businesses. The more locations, equipment and employees you have, the more complicated your business taxes.

The team at H&H Accounting Services is committed to accuracy and accountability. We can make sure you’re saving as much as possible on your Phoenix franchise business taxes while also ensuring you never run afoul of the IRS or the Arizona Department of Revenue. 

What Are Franchise Taxes?

The franchise tax, or the privilege tax, is not unique to franchises in the traditional sense. In some states, every business must pay a franchise tax, regardless of whether they’re a franchise. It’s simply a tax you must pay to operate in a state.


Arizona does not have a franchise tax/privilege tax, but if your business has operations in states that do have a franchise tax, you might need to pay it, even if your business is headquartered and incorporated here in Arizona.



The franchise tax is generally not based on revenue. A business could lose money and still be required to pay the franchise tax. If your Arizona business operates in other states, the team at H&H Accounting can help you understand if you may be subject to any franchise taxes.


Other Franchise Deductions

Labor

Equipment Purchase

Depreciation

Interest Payments

Marketing and Advertising

Travel Expenses

Rental or Lease Expenses

Inventory

Etc.

Franchise businesses, especially those in food service or other industries with a lot of moving parts, have complex balance sheets and cash flow. Bookkeeping and business tax preparation for a single small business can be complicated, but things can get even more convoluted if you’re operating many separate franchise locations.



The team at H&H Accounting Services has extensive experience handling small business bookkeeping, payroll and tax preparation. We can greatly simplify your life and save you money on your taxes and your accounting expenditures.


More Than Just Franchise Tax Preparation in Phoenix

Franchisees must balance the rules and regulations enforced by the franchisor with their own best interests. While some franchisees have nearly free reign to run their business how they see fit, others are held to strict guidelines. 

Our business consulting and accounting services can help make your life easier. We can assist with everything from cost controls and risk management to forecasting and financial analysis. Whether you need help qualifying for additional financing or need an independent third-party to perform a risk tolerance assessment or compliance review, our team can assist. 

Call us at (480) 561-5805 for a free one-hour consultation. 

Tax Concerns for Actual Franchise Businesses

If you run a franchise business in Arizona, you may be wondering if you can write off or deduct your franchise fees. There are two different types of fees most franchisees are charged for the right to operate their business: the initial franchise fee and continuing fees.



The initial fee is the one you pay to start the business. Although it’s considered a startup cost, which could in some cases be deductible, the IRS qualifies initial franchise fees as Section 197 intangibles, which cannot be deducted all at once. However, this intangible – the right to operate the franchise – is an asset. Therefore, it can be amortized and deducted as an expense over many years.


Continuing franchise fees can be deducted like any other normal business expense, especially if your franchise pays regular franchise fees calculated with a fixed formula based on a percentage of sales.

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