With the year rapidly coming to a close, now is the time to start planning for end-of-the-year tax preparations for your business. Go ahead and spend money on your business now for things you’ll need next year so you won’t have to pay a giant tax bill in April
As part of the Economic Stimulus Plan of 2009, the limit on Section 179 deductions has been increased $250,000 for this year, double
what it was last year. New and used equipment qualify for this deduction. Do you need a new computer? Now is the time to buy. It is
important to note that any equipment you claim as a deduction must be in place and working by
2. Believe it or not, it makes sense to buy an SUV that weighs more than 6,000 pounds and use it at least half of the time for business, you can deduct up to 75 percent of the purchase price. Now is an especially good time to invest in a new company vehicle, since car companies are drastically reducing the cost of vehicles
3. Are you a member of your state association? If not, you need to join your local, state, or national association. Business association dues are also tax deductible.
4. Don't forget - education expenses can be deducted if it is a legal requirement for your job, or if they help you maintain or improve skills required in your present employment. Continuing education classes to maintain licensing are part of this category. Also, the registration fees for the conferences and conventions of the associations you just joined are deductible as well. Take the time to register now for conferences and continuing education classes that take place next year.
5. Book your airfare for any of the conferences you registered for, and then deduct it as a travel expense, which includes air fare, hotel rooms, and car rentals. You can also deduct 50 percent of the costs for entertainment and meals, as long as they are related to business.
6. Advertising fees are another deductible business expense. Advertising fees include business cards, fliers, directory listings - basically anything that promotes and publicizes your business
7. The recession is hard on everyone, but it is especially hard on charities. butcharitable contributions are tax deductible.
8. If your budget allows you, try to prepay recurring business expenses now. Consider prepaying rent for a couple months in January, or see if you can prepay your property insurance bill. Other recurring expenses you might be able to prepay include January’s cell phone or car insurance.
9. Here are a few other things that are deductible expenses because they fall into the “ordinary and usual” category: bank service charges, business-related magazines and books, casual labor and tips, coffee and beverage services, commissions, credit bureau fees, office supplies, parking and meters, postage, and promotion and publicity.
10. We've said it multiple times, and we'll say it again - consult a tax professional. No one knows tax laws better than the people who are paid to know them, and they certainly know them better than us. When in doubt, hire a CPA who will let you know for sure what can and cannot be claimed as a deduction. Remember, the cost of a CPA now just might save you the headache of an audit later.