Don’t Let Taxes Steal Your Profits: Smart Moves Every Small Biz Should Make
Taxes can be downright confusing if you don’t know what you’re doing, which is why hiring an expert is a good idea. However, there are a few ways to make sure you’re keeping as much of your profit for yourself as possible.
Why Your Business Needs Its Own Bank Account: Stop Mixing Your Money!
You may be tempted to start out using your own bank account as a business account, but that is one of the worst mistakes you can make. A separate business account and credit card keep your personal finances separate, which means you can easily see your income and expenses in one place. That makes tax time much easier and using the business credit card for automatic monthly expenses can boost your business credit score if you pay it off monthly.
Choose the Right Business Structure for a Brighter Future
Your business structure matters. Depending on the business type you choose, you may have better deductions..
Certain business structures, like LLC or an S-Corp, could allow you to lower your taxable income through health insurance premiums and retirement contribution deductions. Before you choose the structure for your business, talk to a tax pro to find out exactly what is on the table for you.
Don’t Miss Out! Track Those Expenses
Don’t get stuck on only counting expenses paid from your business account! You’ll miss out on some serious deductions that way.
Expenses that may not be paid from a biz account include things like:
Mileage
Home office expenses
Parking fees and tolls
Subscriptions
Unexpected business supplies
Misc. business purchases
Again, if you’re not sure what you can write off, talk to your tax pro . . . that’s what we’re here for!
Big Decisions Call for Big Plans
Large sales or purchases can really affect your tax due, so it’s essential you talk to your tax pro before making any large financial decisions. If you want to get the most from your money, it’s important to plan these things.
Your tax pro can help you avoid the worst tax penalties and organize your big moves to fit into the right tax year. After all, you might as well keep as much of the money as possible!
Score Big with Tax Credits
Do you know which tax credits you’re eligible for? Your business could save big time if you know where to put your money.
From solar power and energy-efficient buildings to electric vehicles, there are plenty of tax credits available. Why not take advantage of them?
You can also talk to your tax professional about retirement plans and whether it’s possible to qualify for deductions on these, as well. In short, your tax pro is your best friend!
One Size Fits All . . . Not!
Every business is different, so remember that while some of these solutions will help your business, some won’t be as effective. Certain moves are ones that every business can benefit from, like tracking expenses and setting up a business account. If you’re not sure which options work for you, it’s best to talk to a tax expert who can walk you through the best choices for your business.
Plenty of people are touting their own strategies (Hello, TikTok!) but that doesn’t mean your tax return permits that benefit. If you try to implement a strategy that won’t work with your income, you’ve wasted time, energy, AND money.
A tax pro can help you make the best choices to maximize your profits. If you’re interested in learning more, contact Ask Anna Tax today.
