Tax season is upon us, and for your small business finances, this could mean some significant stress. Tax Day is when it all comes to light – how profitable (or not) you were, how charitable (or not) you were, and how savvy (or not) you were with your withholdings. And because this time of year can feel overwhelming and confusing, we wanted to lay out a few tips and reminders to help make your tax season this year, or next year, a little easier.
- Plan to retire on day? Then you’ll want to be sure to utilize a tax-deferred retirement plan. Not only does this help you plan for your future, but you’ll be able to claim the deduction without having to give up the funds you spent on it. You can accumulate growth without being taxed on it. When self-employed, it can be easy to sink all of your funds and efforts into keeping your business afloat, but you’ll be forever thankful that you chose this simple act.
- Know what to write off. As a small business owner, your business expenses are many. Take heart that your Scottsdale office rental at Versant can be written off, as can a few surprising items, such as banking fees and some discounts to customers. One thing you can’t deduct? Political contributions. Find a thorough and helpful list of write-off dos and don’ts here: https://www.bigcommerce.com/blog/92-small-business-tax-deductions/#undefined
- See what’s new. Do you know about the new IRC section 199A? Most people don’t, says Tatyana Bunich, President and Founder of Financial 1 Wealth Management Group. “Self-employed business owners, or any other entity where it’s a pass-through, will all qualify for this deduction. Ahead of year-end, taxpayers can set up pension plans to reduce their income, which will make them eligible for the 20% tax deduction This deduction could amount to savings of over $100,000 in taxes.” Read more about it here: https://www.irs.gov/newsroom/tax-cuts-and-jobs-act-provision-11011-section-199a-qualified-business-income-deduction-faqs
Other tax nuances that could be significant for your business? Look up information on bonus depreciation, Internal Revenue Code Section 170(e)(3), or filing an S Corporation Tax Election (Form 2553).
- Feeling overwhelmed? When all else fails, call in a professional. Even if your business is small enough for you to believe that you can handle your own taxes, getting some help can often save you time, money, and a lot of stress. Tax laws are ever-changing, and staying current with them can be a really big job. Or, if you don’t want or need to have your taxes filed by an outside entity, you can instead opt to speak to an accountant about your company’s taxes and finances, get advice, and ask questions. And if you and your accountant would benefit from a spacious, well-equipped, quiet, and professional space in which to work on your taxes, Versant office suites can sufficiently and beautifully meet this need. Our clean, opulent Arizona day offices for rent inspire productivity, which is exactly what you need on Tax Day (and every day).
Tax season doesn’t have to bring about a lot of stress. With the right preparation know-how, and the appropriate space in which to do it, filing taxes can be easier than you think.