Now that autumn has arrived and Q4 is upon us, thoughts shift to falling leaves and cooler weather. For many business owners, now is the time to start preparing for the end of the tax year. Have you scheduled a meeting with your accountant yet? If you haven’t, here’s why you should:
From delaying December invoicing to reduce your end of year income to making charitable contributions, there are numerous strategies for lowering your small business tax bill.
Though your income is taxed based on the year that it was received, if you are a small business owner, you might be able to defer your payments to a later year. This allows your business to hold on to cash, when you need it most.
Another way to lower your tax bill is by accelerating this year’s deductions. This tax planning strategy can work well if you expect your business will owe more in the upcoming tax year than it will this year. Many of your business related expenses can be deducted for tax purposes, but taking advantage of all of your available deductions takes careful planning.
Your accountant will walk you through the tax planning strategies that are available to your business and help you decide what your next steps should be.
Have you been so busy focusing on your small business that you haven’t begun planning for your own future? If so, you are not alone. In fact, the U.S. Small Business Association reports that over 9 million small business owners have no retirement plan.
Not only is planning for your retirement good practice, it can also save you money on your tax bill. As a small business owner, you can save money by contributing to tax-deferred retirement accounts. Offering retirement plans for your employees is another way to retain top talent while taking advantage of the tax benefits available to small business owners.
Whether you haven’t started saving for your retirement or want to learn more about reducing your tax burden, your accountant will help you determine the appropriate contribution amounts.
In order to get the most tax benefit from the purchase of business equipment, your timing must be precise. Even when equipment is purchased before the end of the calendar year, if it is not put into use by that time, you might not be eligible for tax benefits.
It’s important to consider not only the timing of your equipment purchase, but also how you are going to pay for it. Your accountant can discuss all of your purchase options with you, along with what can or cannot be deduced on your taxes.
Each year, tax payers spend around six billion hours trying to comply with tax filing requirements. There’s no reason to tackle your taxes on your own. Your accountant will help you understand what your business is responsible for and how to minimize what you owe.
There are many strategies that can help you reduce your tax liability, but few of these can be utilized after December 31st. Employing the right tax strategy makes good business sense, but there is a difference between shrewd business planning and tax evasion. Your accountant will help you to avoid legal mistakes and costly fines.
Relying on the advice and support of a financial professional will help your business get prepared for tax time. Don’t wait until it’s too late to take advantage of all of the money-saving benefits that your accountant has to offer you.
Schedule an appointment with Lauzen Accounting today to learn how you can lower your tax bill and best prepare for the year ahead.