As a small business owner or an entrepreneur you should be talking to your accountant at least once or twice a year, and ideally more often, to make sure that you are taking full advantage of any tax deductions or opportunities that you may have.
The Small Business Advantage
Often small businesses have significant tax opportunities that are missed simply because the small business owner didn’t realize the deduction or tax credit was even possible.
Some of the most commonly missed money-saving ideas that accountants can help small businesses with include:
- Capital expenses and equipment – there is an annual allowance under the Section 179 deduction that business can take for specific types of equipment and supplies but the total allowable is based on several different factors.
- Fully fund retirement plans – often small business owners forget that by funding their own retirement plan, or getting one started, that you can use to off-set your income for the tax year.
- Hiring – you may be surprised that there are programs that you can take advantage of if you hire a disabled person or a veteran. This is a great opportunity to help out a person that has served the country while also earning a tax credit with each eligible employee.
- Get your equipment repaired – if you have eligible property such as vehicles or an office or building, you may be able to spread out the deduction for the repair over a period of time. In some cases and for some businesses the repair, especially if it improves energy efficiency, may also be a credit.
- Charitable donations – a business can also make charitable donations to recognized charities. These can be made any time of the year but if you have additional income in December it can be a good way to use the deductions in this year rather than waiting until the next year.
Talking to your accountant well before the end of the year is always a good strategy. You can learn about your options and then make the best choices to help to lower your taxable income while maximizing your ability to take advantage of services and purchases that you may need.