When running any business, taxes are a major aspect that requires proper planning. You don’t want to drown your business in government taxes. Therefore, you will want to know the ins and outs of tax strategies. For businesses big or small, Mark Dicus & Company will share the best strategies for managing your business taxes.
One of the best tax strategy plans is to make full use of the company’s expenses to help offset the income. To properly utilize your business expenses, you will first need to have a good idea on how much money your company brings in per year. With the start of each year, you will be able to better manage your business taxes and maximize your expenses. With a semi-accurate income figure, you can better know how much you can spend on business expenses without offsetting revenue. However, you will need to make adjustments with the money income as this can go up or down. When monthly income drops, you will need to spend only with the company’s income rates. This will not only help avoid diving deeper into debt but save you on taxes as well.
Employee Retirement Accounts
Another way to help maximize savings on taxes is to set up retirement accounts for your employees. By making regular contributions to employee’s retirement accounts, you can maximize the end of the year deductions. When a business owner uses this common tax strategy, they can deduct the full contribution amount made to the employee’s retirement account from their taxable income. However, it will depend on the type of account the employee has as well as its federal contribution limits.
Green Tax Credits for Business
For a smaller business, there are a number of different federal programs that encourage green projects. Depending on the business, there is a measure that can be taken that may make the business eligible for a tax credit. For example, if you have more energy efficient windows installed you can get a tax credit. Other ways to get a green tax credit is by upgrading to energy efficient A/C and heating, solar energy, and more. As each state is different as to its green tax credit programs, you will need to do some research and see where they can apply to your business.
Business Investment Strategies
If your business or company uses investment strategies, make sure to look at your portfolio before the end of each year. You will want to be made aware of failing investments you can either sell or discontinue. You will want to first cut loose from a failing investment, and also offset all the gains that you can on your books. A false capital gain can have you paying higher taxes and greatly hurts a business. Timing is essential, so you will want to cut loose any investment that can hurt your business dramatically in the future. You can always consult with an investment professional if you are not sure if an investment can hurt your business.