As a business owner, thinking about taxes may not be the most exciting thing to do. However, tax planning is essential to avoid penalties and reduce tax exposures. Regardless of how simple or complex a tax strategy is, it will be based on structuring the plan to accomplish one or more of the following goals:
- Reducing the amount of taxable income
- Lowering your tax rate
- Managing tax payments and schedules
- Maximizing any available tax credits
- Mitigating the effects of the Alternative Minimum Tax
- Avoiding common tax planning mistakes
Many deductions are available to small business owners they may not be aware of. Therefore, it’s crucial to discuss deductions with your advisers, including automobile deductions, home office deductions, travel expense deductions, and entertainment expense deductions. Taking advantage of deductions allows you to deduct business costs from your gross income.
Ongoing tax planning ensures you fully use allowable expenses to reduce tax liability. Effective tax planning can also enable you to bring forward expenses or defer income, delaying tax payments. We recommend consulting your tax accountant to decide which strategy is best for your firm.
At ZümiFi, we understand that bookkeeping is the foundation of a successful business. We take pride in our ability to understand each client’s unique needs and make custom-designed recommendations that truly move things forward to deliver great books. Bookkeeping in the cloud takes our joy to the next level by optimizing opportunities to automate data entry and connect various online tools that can synchronize seamlessly with your QuickBooks Online.
Regarding tax planning, getting your final year-end estimates to your CPA is key. It ensures that your tax returns are filed on time and penalties are avoided. As your bookkeeping solutions provider, we work closely with your CPA to ensure that all the necessary information is available to file your tax returns accurately and on time.
In conclusion, tax planning may not be the most exciting part of running a business, but avoiding penalties and reducing tax exposures is essential. Therefore, it is key to consult with your tax accountant and provide them with accurate year-end final estimates. At ZümiFi, we’re committed to providing exceptional bookkeeping solutions to help you achieve your business goals.
Contact us today to learn how we can help you with your bookkeeping needs.