|
|
|
|
YEAR END TAX PLANNING AND PREPARATION FOR BUSINESSES ? Tax Tips
for 2004 |
|
by: Dianne Goodman,
CPA |
Now is the best time to
start thinking about your year end tax planning for your business.
These tax strategies can be put into effect by the end of the year
and some as late as when the tax return is due. Planning now will
save you money and reduce your tax liability not only with your IRS
taxes but also with your state taxes. Here are tax tips that will
help you accomplish your goal.
DEFER YOUR INCOME INTO 2005
If you don?t receive payment until the first week of January
for cash basis tax returns and don?t bill until January for accrual
basis tax returns, you have effectively deferred your income. This
works well if your 2005 income is equal to or less than it was for
2004. If not, you are delaying the inevitable and potentially
putting yourself in a higher tax bracket for 2005.
ACCELERATE DEDUCTIBLE EXPENSE INTO 2004
Anything
charged on your business credit card December 31st and prior is
deductible in 2004 even if it is paid in 2005. You can also write a
check on December 31st that you would have normally paid in January.
You may want to get a confirmation receipt to prove you mailed those
checks in 2004. This works well if your 2005 income is equal to or
less than it was for 2004. If not, you are delaying the inevitable
and potentially putting yourself in a higher tax bracket for 2005.
OPEN A RETIREMENT PLAN ACCOUNT
See
http://www.dgoodmancpa.com/smallbusinessretirementplan.htm for an
example of what you can do with that available profit tax deferred
until retirement. This is a fantastic option for those who have the
cash and want to contribute money into their personal retirement
account and deduct that contribution from their corporate earnings.
Does it get any better than that?
BUY EQUIPMENT AND SOFTWARE
BEFORE YEAR END
You can deduct up to $100,000 in equipment
and software purchases for the year under Section 179 depreciation
expense. This includes sport utility vehicles, pickups and vans with
a gross vehicle weight rating over 6,000 pounds. However, businesses
should be aware of the change due to the American Jobs Creation Act
of 2004. Certain sport utility vehicles (SUV?s) are limited to
$25,000 if they were placed in service after October 22, 2004.
These are just some tax tips you should consider when
thinking about your year end tax planning for your business. If you
have a specific question about your particular situation, e-mail me
at dianne@dgoodmancpa.com and I will help you muddle through the tax
planning issues you may have.
This article was intended to
provide general information about year end tax planning. It does not
contain all the rules and exceptions that may apply to your
situation. If you have further questions regarding year end tax
planning, I can be reached at www.dgoodmancpa.com.
Coming
Soon - E-mail me at dianne@dgoodmancpa.com and tell me what you
would like to know more about. It just might be my next article!
CONTACT INFORMATION:
Dianne Goodman, CPA
Comprehensive Small Business Solutions, PC
505 323-2307
1 866-531-3035 toll free
http://www.dgoodmancpa.com
You have permission to reprint what you just read. Use it in
your ezine, at your website or in your newsletter. The only
requirement is to include the following footer...
2004 Year End
Tax Planning and Preparation for Businesses ? Tax Tips for 2004 by
Dianne Goodman, visit http://www.dgoodmancpa.com for more content
like this.
About the author:
About the Author
Dianne Goodman, CPA ?Specializes in servicing Small
Businesses and Individuals. Visit http://www.dgoodmancpa.com/for relevant and
current information on a variety of financial and tax issues
focusing on small businesses and individuals or call at
1-866-531-3035.
Circulated by Article Emporium and Software4yoursuccess.com
|
|
