Tax season is fast approaching and whether you’re an individual, own a business or are an entrepreneur, strategic planning can help you save some money. You probably don’t have time to stay up to date on all the latest strategies, but we do. Need to know about how to reduce your tax burden? We can help with that. Wondering about filing deadlines? Look to us. Trying to understand the bureaucracy of the IRS? Don’t bother, instead let us do the hard, boring work of figuring out your best tax strategy.
Today, we’re going to discuss small business tax planning. Why is it so important to hire someone to help you with your taxes? Simply because if you don’t you are probably giving away money that you could have kept.
First off, claim the deductions that you are entitled to. There are two such deductions that most small businesses can qualify for. Let’s say you have a home office, if you work from home at all, you can most likely make a deduction based on how much of your home is dedicated to use as an office (usually around 15%-35%).
The second thing you can deduct is car expenses. Most small business owners use their car for work. You can deduct for mileage–driving to and from work, or deduct if you drive to meet clients. You can deduct for expenses related to gas, your car insurance, parking fees, repairs, oil changes and other maintenance, etc.
Another way to reduce the amount of taxes you pay is called income splitting. This simply means that the income from your business is shared between you and another family member. Let’s say it’s your spouse, you will need to prove that your spouse actually does things for the company–that means daily tasks, not just once in a while. Also, you need to pay your spouse the same amount you would pay another who was in the same position.
These are just a few tips we can provide here in this blog. For a full consultation, call us today.