If you’ve recently started a business – or are thinking about starting a business – you should know that as an owner, all eligible costs incurred before beginning to operate the business are treated as capital expenditures. As such, they are part of the cost basis for the business.
For many nonprofits and taxpayers alike, Giving Tuesday is the start of the charitable giving season. While most organizations are legitimate, taxpayers should always research charities before donating. It is also a good idea to understand the expanded tax benefits of giving to causes that mean something to you personally. Taxpayers should also know that they may be able to deduct donations to tax-exempt organizations on their tax returns.
As we approach the end of the year, it’s time for business owners to review your business finances. In this post, we highlight the most crucial tax changes you need to know for 2021.
Several end-of-year tax planning strategies are available to business owners to reduce their tax liability. Let’s take a look:
Deferring Income
Businesses using the cash method of accounting can defer income into 2022 by delaying end-of-year invoices so that payment is not received until 2023. Businesses using the accrual method can defer income by postponing the delivery of goods or services until January 2022.
If you hire someone for a long-term, full-time project or a series of projects that are likely to last for an extended period, you must pay special attention to the difference between independent contractors and employees.
The Internal Revenue Service and state regulators scrutinize the distinction between employees and independent contractors because many business owners try to categorize as many of their workers as possible as independent contractors rather than as employees.
If you’re a savvy investor, you probably know that you must generally report as income any mutual fund distributions, whether you reinvest them or exchange shares in one fund for shares of another. In other words, you must report and pay any capital gains tax owed.
But if real estate’s your game, did you know that it’s possible to defer capital gains by taking advantage of a tax break that allows you to swap investment property on a tax-deferred basis?
Can you point your company in the direction of financial success, step on the gas, and then sit back and wait to arrive at your destination? Probably not.
While you may wish it was that easy, the truth is that you can’t let your business run on autopilot and expect good results. Every business owner knows you need to make numerous adjustments along the way. So, how do you handle the array of questions facing you? One way is through cost accounting.
Starting your own business is an exciting prospect, but there is more to it than simply writing a business plan. Understanding the tax responsibilities of starting a business venture can save taxpayers money and help set them up for success. That’s where a tax professional can help. Here is what you need to know before you start a new business:
According to the U.S. Small Business Administration, small businesses employ half of all private-sector employees in the United States. However, a majority of small businesses do not offer their workers retirement savings benefits.
If you’re like many other small business owners in the United States, you may be considering the various retirement plan options available for your company.
Federal law requires most employers to withhold federal taxes from their employees’ wages. Whether you’re a small business owner who is just starting or one who has been in business for a while–and ready to hire an employee or two–here is what you should know about withholding, reporting, and paying employment taxes. Continue reading
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