The actual tax season is still a few months off, however, the fourth quarter is always a good time to evaluate your business tax strategy and potentially make some adjustments in anticipation of April 15th. To save on taxes, there are moves you can make—keep in mind though, these generally need to be executed before the end of the year. Below are three such tax tips you might want to think about doing now.
Retirement Plans
Be it a 401k, a SEP IRA or a Solo 401k, establishing such a retirement plan for your business is one of the smartest things you can do as far as tax moves go. With a SEP IRA and SOLO 401k, you can contribute pre-tax earnings, capped at 56k. In both cases, you will not pay taxes on the money invested in the account.
Home Office Deduction
If you are a small business owner who does work from home, then you could qualify for a home office deduction. You probably want to discuss the details with an accountant. However, percentages of everything from your mortgage to your utility bills are generally considered part of this deduction. In the long run, the home office deduction can potentially save you hundreds, if not thousands.
Organize Your Books
A pretty straightforward tip, but you'd be surprised how many business owners have books that are a mess—and that's putting it gently. Organization comes tax time especially is everything. If you are too busy running the company, consider hiring a qualified bookkeeper to come in and whip your books into shape.
First Union Lending would love to help your small business get ahead and be ready to go come the new year. Call today to find out about our fast and flexible commercial lending products!