If you own an S-corporation, you are more than likely looking for any way possible to save money on your taxes. At least you should be. The thing is, there are more than likely a few ways to save on taxes that you aren’t fully taking advantage of. Mark Dicus & Company is here to talk about some of the different strategies you can use to save yourself some money.
Don’t Overpay Yourself in an S Corp
It may seem like paying yourself more will help you make more money than limiting the money you’re getting from the business. However, you want to make sure you aren’t overpaying yourself. When you do this, you will find that you’re are paying way more on your s corporation’s payroll taxes. There is a fine balance between paying yourself a reasonable compensation and overpaying.
Can I Pay My Child Through an S Corp Business?
If you have kids that are old enough to work for you, take advantage of it. When you hire a child that lives in your home, they can make up to $12,950 without being required to pay taxes on it. This can help to decrease the income taxes that your family has to pay. Shockingly, your child only has to be over 7 years old to complete actual jobs for your business and get paid for them. Make sure you’re paying your child the same that you would pay any other employee to the job they are completing. You also need to make sure you’re completing timesheets, onboarding and w-2s for them.
Rent Your Home to Your Business
If you frequently hold meetings or use it for any other gathers that have to do with your business, you can actually rent your home to the business for those days. There are a few rules to follow though:
– You can only rent it up to 14 days in one calendar year
– You have to keep records of the events that are taking place
– The amount of money you are renting the house for should be similar to what other places are renting for in the area
Sell Your Home to the S Corporation
If you are planning on moving out of your home and renting the property, you can actually save money by selling the house to your s corporation first. You can’t do it unless you aren’t planning on living in the home. This will help increase the s corporation’s deductions. You can also avoid paying taxes on up to $250,000 of the profit from the sale of the home.
Tax Preparation, Filing, Planning & More in Salt Lake City, St. George, West Valley City, Provo, Orem, West Jordan & Greater Cedar City, Utah
If you are looking for ways that you can save money on your taxes, you can turn to Mark Dicus & Company for help. We will ensure you aren’t paying more taxes than is necessary to help your s corporation see as much success as possible. We can answer any questions that you may have. Call us today!