It’s Not Too Late for Tax Planning for 2021 Even Though Half the Year Is Almost Gone
Whether you are filing as a corporation, partnership, LLC, or individual, you can benefit from doing some tax planning now. You must do some tax savings strategies for businesses, like timing income and expenses, before the end of the tax year. But you can do others any time before you file your return. So, you still have time. The tax professionals at PHB CPAs can advise you on various ways to reduce your tax bill for 2021.
6 Tax-Saving Tips for Businesses
The following tips are not intended to be tax advice. They are suggested topics you can discuss with your tax expert at PHB. Remember, for expert advice on business taxes Nashville turn to PHB.
- Apply for PPP forgiveness. Read more about this in our blog Applying for Forgiveness for PPP First Draw.
- Set up and fund a retirement plan. This can be for yourself or for your employees. Make sure it’s a qualified plan the IRS recognizes (IRA, 401(k), 403 (b), etc.). This will allow you to defer taxes on earnings until you withdraw the earnings.
- Take tax credits to lower income. This includes credits for hiring employees, going green, providing access for the disabled, and providing health coverage for employees.
- Take 100% Deduction for Business Meals. See our blog PHB Explains the 100% Deduction for Business Meals for details on this.
- Buy equipment/vehicles for depreciation deductions. For certain assets that you purchase, you can take an immediate deduction for the cost when you put it in service. The Tax Cuts and Jobs Act also allows for a 100% tax break for assets placed in service from September 27, 2017 through January 1, 2023.
- Time your business income and expenses: This involves prepaying some expenses to reduce your income for the year. For example, you could stock up on supplies that you know you will use in the next tax year.