23 End of the year tax tips for small business owners

Post on: 11 Октябрь, 2015 No Comment

23 End of the year tax tips for small business owners

With only a few weeks left before the end of the year, instead of making a mad dash to the mall, make a mad dash to your accounting books and look for some last-minute ways to save money, spend money and prepare for the 2011 tax season. It’s not too late to get your books in order for a fruitful year. Below are some tax tips you may have overlooked, forgot or simply did not know.

Although, many of the contributors are tax professionals, please consult your tax advisor for additional information and details on these tips apply to you.

1.  Make efforts to collect receivables in 2010 and opt to accelerate bonus payments into 2010 instead of January 2011.  Serene Buckley via Mary Canning, Dean of the School of Taxation and School of Accounting, Golden Gate University, San Francisco

2.  Defer income until January if possible so you will not be taxed on it until 2011.  If you own stock that has decreased in value and you plan to sell it, do so before the end of the year so you can claim the capital loss on your 2010 tax return. Charles E. McCabe, CEO, www.peoplestax.com




6.  Establish a file folder marked 2011 Taxes.  As you start to receive the annual on slot of Important Tax Documentsdenisewinston.com


8.  Equipment, furniture, and vehicle purchases made before December 31, 2010 will be eligible for a temporary bonus  depreciation  which allows an extra 50% of the cost of the item to be depreciated in the first year it’s used in your business. This can be especially beneficial for passenger vehicles used in a business as, without the bonus amount, depreciation on them would be limited to less than $4,000 in the first year. Jan Zobel EA, www.JanZtax.com

9.  Moving expenses.  If you had to move because of a job, you can deduct the cost of moving as long as the job was at least 50 miles from where you lived. Ornella Grosz,  www.moneyliciousblog.com


11.  In my business as a consultant to entrepreneurs entering franchise business ownership from corporate America,  I see many that have been downsized or displaced. This means they could have had significant income during the year and a severance package. I encourage my clients to meet with their CPA before the end of year to understand the tax benefits of purchasing their new franchise business in the same year they experienced higher income as opposed to waiting until the next year when they are likely to have less income as there business opens and grows. By doing this they begin to enjoy the many attractive tax deductions provided by the government to induce us to start our own businesses and create jobs for the economy. Gordon Dupries, www.frannet.com/gdupries


13.  One of the easiest win-win situations for year-end tax planning is to clean out your closets and donate  what you do not need to charity. Make an accurate list accurately detailing the cost and true fair market value for each item that you are donating. You can deduct the lower of the cost or fair market value. This way you helped out some one in need and get a tax deduction at the same time! Gail Rosen,  www.gailrosencpa.com


15.  Estimate next year’s taxes.  It is a good idea to estimate next year’s taxes and plan based on the estimate. This is especially important for people who will be impacted by the expiring tax cuts. All tax brackets are likely to increase. Major changes are in store for married couples and parents, as well as people who owe estate tax. Those who must pay estimated income taxes could estimate their 2011 earnings to sketch out their tax burden. Jeff Staley:  www.freedomtaxrelief.com

16.  Hit the books or attend a business conference.  Small business owners who are interested in furthering their education should be aware of current tax incentives. The amount and type of tax deduction depends on a few things (1) classification (sole proprietorship or C corp.) (2) type of education, and (3) the small business owner’s personal tax background. Examples include: Small business owners can take advantage of the AMERICAN OPPORTUNITY CREDIT of up to $2,500 per year for the first four years of higher education through 2010. After 2010, it will revert to the HOPE CREDIT of up to $1,800. Small Business owners can deduct attendance fees, and even room and board for business/educational seminars they attend. Paul Heiselmann,  www.bdo.com

23 End of the year tax tips for small business owners

17.  Tax loss harvesting.  Consider selling, at a loss, an investment that does not belong in your portfolio and allocating that money towards a more appropriate investment.  This will allow you to offset capital gains and taxable income.  Tom Mooney,  https://www.veritat.com/

18.  With the IRS, spelling counts.  Double-check the correct spelling of employee names and addresses, and especially Social Security numbers. Do the same for 1099 payees. Len Redon, www.paychex.com

19.  Use the 12 by 12 Method to get organized for tax time.  Give your self 12 days during the next few weeks to through your bank transactions and credit card transactions to isolate those charges that are tax deductible. If you give yourself 12 days by 12-31-10, you will be a head of the game and will start your New Year off organized. Karla K. Dennis, Cohesive, Enrolled Agent

20.  If you own a small business, consider paying your kids to help you  and take a tax deduction of up to $5,800 per child depending on the job they are doing. The child will not have to pay income taxes if they are under 18 and you will not have to pay employment taxes. This is a perfect way to shift income off of your return. Karla K. Dennis, Cohesive, Enrolled Agent




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For over 18 years, Simplicity Mastered™ founder and CEO A. Michelle Blakeley  has owned or managed small businesses and nonprofit organizations. Expert in her field, Blakeley personally guides her clients out of their Business Brain Freeze™ to streamline operations, increase return on investment, and attain quantifiable results.  Forbes.com  and  FinancialPost.com  each recommended her as one of 30 Women Entrepreneurs to Follow on Twitter, joining the experts who know that Blakeley is a master at growing small businesses … and doing it with “Simplicity.”

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