By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
AmextaFinanceAmextaFinance
  • Home
  • News
  • Banking
  • Credit Cards
  • Loans
  • Mortgage
  • Investing
  • Markets
    • Stocks
    • Commodities
    • Crypto
    • Forex
  • Videos
  • More
    • Finance
    • Dept Management
    • Small Business
Notification Show More
Aa
AmextaFinanceAmextaFinance
Aa
  • Banking
  • Credit Cards
  • Loans
  • Dept Management
  • Mortgage
  • Markets
  • Investing
  • Small Business
  • Videos
  • Home
  • News
  • Banking
  • Credit Cards
  • Loans
  • Mortgage
  • Investing
  • Markets
    • Stocks
    • Commodities
    • Crypto
    • Forex
  • Videos
  • More
    • Finance
    • Dept Management
    • Small Business
Follow US
AmextaFinance > Finance > 5 Strategies For Small Businesses To Reduce Tax Burden
Finance

5 Strategies For Small Businesses To Reduce Tax Burden

News Room
Last updated: 2023/08/15 at 4:39 PM
By News Room
Share
5 Min Read
SHARE

The government loves to partner with small business owners.

It’s true.

A functioning society needs all manner of goods, services and jobs for its citizens — including those provided by small businesses. When the government wants more of these, it offers tax incentives to entrepreneurs to encourage them to invest back into their businesses.

This creates a win-win. Business owners make investments that grow their businesses and lower their taxes, and the government expands the economy.

These tax incentives aren’t loopholes. And they aren’t a secret. They’re just part of the tax law.

In fact, the government has created page upon page of tax incentives designed to encourage people — especially business owners — to take actions that benefit society. Tax expert Tom Wheelwright, CPA shared these top tips on how small business can reduce their tax bill in a recent interview:

1. Take the home office deduction.

Lots of people work from home, but business owners are the only ones who get to deduct the expenses associated with their home offices from their taxes. Dedicated office space, high-speed internet, higher utility bills and office supplies are just some of the expenses you may be able to deduct.

Unfortunately, many people who qualify for this deduction don’t take it out of misguided fear that it is a “red flag” that will trigger an IRS audit. This advice isn’t coming from a good CPA. Small business owners need to work with a CPA who will show them how to use and document their home office expenses correctly so they can receive the deductions to which they are entitled without fear of an IRS audit.

2. Buy a building.

Small business owners who own, rather than rent, the property that houses their business create additional opportunities to increase their wealth while paying less tax. Banks are often happy to lend for these purchases, and the loan isn’t considered taxable income. Then, thanks to a tax incentive known as bonus depreciation, small business owners can deduct a large portion of the purchase price in the first year, even when they used a loan to make the purchase. It’s like having the government pay for part of the purchase.

3. Install a solar power system.

Once they have their own building, small business owners can further reduce their taxes (and their energy costs) by investing in a solar power system.

The government has put a number of great tax incentives in place to entice more people to make the shift to renewable energy sources. Right now, entrepreneurs can receive a 30% tax credit and deduct more than 65% of the cost of the equipment in the year they buy the equipment. Then, deducting the interest expense and/or finance costs associated with any loans they take out on the equipment provides even more tax benefits.

4. Buy or lease an electric vehicle.

Like other business expenses, vehicles that are used for business create tax deductions. And because the government wants people to switch from gas- or diesel-powered vehicles to electric, it is offering great tax credits to do so.

Individuals with high incomes aren’t eligible for the tax credits on vehicle purchases, but the full tax credit is available if you lease the vehicle. In addition, the monthly lease payment can be deductible to the business if used solely for business.

5. Add electric vehicle charging stations.

Once a small business owner has a building with solar power and electric vehicles, adding charging stations to the property only makes sense. Luckily, the government also wants entrepreneurs to help build out the network of charging stations. Ready access to charging stations is key to convincing more drivers to switch to electric, so the Inflation Reduction Act included tax credits for businesses that install new EV chargers worth up to $100,000 per charger.

These five investments are just the beginning of the win-win opportunities available to small businesses. Entrepreneurs should work with their tax advisors to ensure they are maximizing their business growth and minimizing their taxes.

Read the full article here

News Room August 15, 2023 August 15, 2023
Share this Article
Facebook Twitter Copy Link Print
Leave a comment Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Finance Weekly Newsletter

Join now for the latest news, tips, and analysis about personal finance, credit cards, dept management, and many more from our experts.
Join Now
Musk launches US political party to fight ‘one-party system’

Unlock the White House Watch newsletter for freeYour guide to what Trump’s…

Retail investors reap big gains from ‘buying the dip’ in US stocks

Stay informed with free updatesSimply sign up to the US equities myFT…

Israel to join ceasefire talks despite ‘unacceptable’ response from Hamas

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects…

Tesla and China: EV maker is facing competition like never before, analyst says

Watch full video on YouTube

How Tariffs Will Make Everything More Expensive In The U.S. | CNBC Marathon

Watch full video on YouTube

- Advertisement -
Ad imageAd image

You Might Also Like

Finance

4 Ways To Avoid Fake Shipping Fee Swindles

By News Room
Finance

Dell Supports Endeavor Miami’s Quest To Empower Black Founders

By News Room
Finance

The World’s 10 Most Expensive Cities To Live

By News Room
Finance

Biden Sends Student Loan Forgiveness Emails To 800,000 Borrowers

By News Room
Finance

New Student Loan Forgiveness Application For Those With Medical Issues

By News Room
Finance

Who Really Owns Nursing Homes, And How The Feds Are About To Learn More

By News Room
Finance

Gone Are America’s Cushiest Federal Prisons

By News Room
Finance

Can You Still Get Insurance After A Cancer Diagnosis?

By News Room
Facebook Twitter Pinterest Youtube Instagram
Company
  • Privacy Policy
  • Terms & Conditions
  • Press Release
  • Contact
  • Advertisement
More Info
  • Newsletter
  • Market Data
  • Credit Cards
  • Videos

Sign Up For Free

Subscribe to our newsletter and don't miss out on our programs, webinars and trainings.

I have read and agree to the terms & conditions
Join Community

2023 © Indepta.com. All Rights Reserved.

YOUR EMAIL HAS BEEN CONFIRMED.
THANK YOU!

Welcome Back!

Sign in to your account

Lost your password?