For small businesses in the U.S., tax preparation is an essential part of maintaining a profitable bottom line. There is absolutely no reason that a company should pay more in taxes than it legally is obligated to pay.
For brand new startups or small businesses that have been in existence for many years, careful tax preparation can save thousands of dollars annually. Here are some of the key points to remember when you sit down and begin to create a tax preparation strategy:
Deferring a new contract payment or other income sources until after January can usually mean a lower tax bill. Ask your accountant if there are any income streams that can be shut off until after January arrives.
Now is the time to create or pay into a retirement account so that you get credit for the payout on this year's tax filing. There is no better time to contribute because at year-end, you tend to know your financial position better than at any other time of the year. If times have been good, then consider upping your retirement contribution. This is one of the most common ways that small business owners cut their tax bills.
Speak with your accountant to determine how successful your business year was. Having a clear picture of your overall financial health will tell you many things and help you devise a generalized tax strategy for the year-end.
Most small business owners give at least a small amount to local charities, often during the holiday season. Make sure you get that year-end giving on the books before the calendar changes over to January. Also, keep in mind that donations can be cash or goods. It's usually smart to donate used and ready-to-be-replaced office items like furniture and equipment to local charitable organizations. You can deduct the fair market value as a donation for something you were going to get rid of anyway.
Is your business planning on upgrading a computer system, buying a whole new PC setup, acquiring a vehicle, redecorating the interior or exterior space? Now is the time to spend that money in order to minimize your tax burden come next year.
With the new year's tax deadline fast approaching, even quarterly files need to be looking at the many ways they can minimize their tax burden legally, simply, and quickly. Always work with a professional when devising tax strategies for your company. At Flynn Financial Group, Inc., website address http://www.wjflynncpa.com, a highly-trained team of tax experts has the experience necessary to show small business owners how to boost their profits, cut their effective tax rate, and stay financially successful year after year. Contact the firm via their website, or call 401-846-6767 to speak with a team member. In addition, you can always feel free to email Flynn Financial Group at bill@flynngroupinc.com, where tax preparation experts are always ready to help.
Flynn Financial Group Inc