In just a couple of weeks, the tax year will come to an end. So this is your last chance to make the moves that will maximize your 2017 return’s accuracy and minimize the taxes you owe.
1. Consider new equipment purchases.
You might be thinking you’ll wait until the first quarter of 2018 because cash flow will be better then. Think again: buying before year-end lets you use Section 179 or other tax benefits and take some of the purchase prices from the money that would otherwise have gone to the IRS.
2. Determine your tax bracket.
Review your 2017 profits with your CPA to figure out exactly what percentage rate you will be taxed at. Once you know that amount, you can more easily manage cash flow, plan for the first quarter of 2018, and make informed decisions about such expenditures as employee holiday bonuses or leasehold improvements.
3. Check personal credit cards for business expenses.
Situations where you can’t pay with the company card happen to every business owner. So you give the supplier your personal card. And in the fast pace of daily operations, it’s easy to forget to reimburse yourself for those expenditures. Now is the time to move that money where it belongs.
4. Pay state tax now.
If you pay your state tax in 2017, you can take it as a deduction on your 2017 return.
5. Do a year-end inventory reconciliation.
Why pay tax on merchandise that’s unsellable, or just plain not there? Your reconciliation should account for spoilage, shrinkage, returns, and out-of-date products.
Bonus tip: Utilize Xendoo’s catch up services.
Xendoo understands that, as a small business owner, you wear many hats and have next to no time to keep on top of accounting and bookkeeping. You may have been behind for years, yet we can usually bring your financials up to date in a week. It’s that easy to start the new year with peace of mind about the state of your business … not to mention the tax savings we just might find!