Try These Tax Ideas for Your Business Before the Year Ends
Are you a business owner? Then chances are you’re already busy getting ready for your taxes. Personal taxes can be a pain for many people, but business taxes can be even more complicated. This is a very important time of year for just about every business because making the right moves now can help save you a bundle on your taxes in a few short weeks or months when you file your return.
So what can you do right now to effectively prepare for the end of the year? There are actually many different strategies you can use. Instead of paying a big chunk of your income to self-employment tax you can choose to be taxed as an S-Corporation. You can even make it retroactive to January 1, 2015. You just need to fill out and file the paperwork and make sure you take some money out for payroll for yourself.
Another move you can make if you own a business is to put your kids on your company payroll. Provided your children are actually doing the services that they are being paid for you can earn a nice tax break. If you pay your kids through a single member LLC or through a sole-proprietorship and your child is younger than 18 then your business doesn’t have to withdraw payroll or FICA taxes. Your children can also use their $6300 standard deduction against the income you pay them.
You can also start a 401k plan before the year is over or you can turn your 401k or traditional IRA into a Roth IRA. Another option is to spread your income out and push some of it into the next year, which can reduce your tax liability. Likewise, you can increase your expenses in the current year. Lastly, consider purchasing an SUV or large truck for your business, which can be a huge depreciation deduction.
There are many other year-end tax strategies that business owners should consider. You can speak with the experts at GROCO for more tax-savings advice. Just call us at 1-877-CPA-2006 or click here.
Who Really Qualifies as a Dependent for Taxes?
How many dependents do you really have? Who can really be counted as a dependent? These are some of the most common questions that all taxpayers have. Can you count all of your children, live-in help, or perhaps a dog or other family pet? What about a friend who decides to crash at your place…
Obama Looking to Stick the Wealthy With Even More Taxes
His second term in office is winding down, but President Obama would still like to raise taxes on high net worth individuals before he checks out of the White House at the beginning of next year. Although the president has already taken several measures to raise the effective tax rate on the wealthy, he is…
Which Tax Breaks Help High Net Worth Taxpayers the Most?
It’s no secret that the United States government generally taxes high net worth individuals at a much higher clip than those in the lower- and middle-income brackets. However, despite that fact, there are still many provisions in the tax system, if used properly, can help wealthy earners save on their taxes. So what are some…
Tax Preparers Get Busted for Fraudulent Practices
Every tax season is full of stories and tales of people who go to great lengths to avoid paying taxes. In addition there are dozens of reports of unscrupulous tax preparers that get caught trying to cheat the system: either their clients or the IRS, or both. We want to share a few of those…