Smart Moves to Lower Your Business Tax Bill

The slower pace of summer provides an ideal opportunity for strategic financial planning. While tax season may seem far off, now is the perfect time to take proactive steps that can lead to significant savings and less stress come filing time.

Maximize Retirement Contributions

Contributing to a 401(k), IRA, or SEP IRA not only lowers your taxable income but also builds future security. Remember, the sooner you contribute, the more you benefit from compounding growth. If you don't have a qualified retirement plan for your business, reach out to us to find out if it would make sense for you to have one set up.

Accelerate or Defer Income and Expenses

Strategically timing your income and expenses based on expected profits can result in substantial tax savings. Consider accelerating expenses if you anticipate higher profits or deferring income in lower-profit years for maximum benefits.

Review Your Business’s Deductions

A mid-year review of your expenses helps ensure accurate recordkeeping and maximizes deductible expenses such as travel, supplies, and insurance. Keep those records organized for a smoother tax process.

Take Advantage of Section 179 Deductions

Investing in qualifying equipment can yield significant tax benefits through upfront deductions. Make Section 179 work for you by understanding what equipment qualifies and planning your purchases accordingly.

Make Note of Tax Credits

Explore potential tax credits for energy efficiency, accessibility upgrades, or product innovation. Understanding credit criteria in advance ensures you can take full advantage when it's time to file.

Fall is the perfect time for proactive tax planning. These strategies can pave the way for a lower tax bill and strengthen your financial footing. Remember, you don’t have to go it alone. Consider scheduling a mid-year tax check-in, and don’t hesitate to reach out with questions or for personalized advice.