Here are a few quick tips to help you reduce taxes

Open a separate business checking account. Many small business owners don't realize the complications that can arise from using their personal checking account to pay for business expenses. If business expenses are mixed in with personal expenses, the IRS may disallow them.

When you set up a business checking account at the bank, be prepared to submit either your social security number (SSN) or an employer identification number (EIN). Your SSN will do if you plan on establishing a sole proprietorship and do not have employees or a retirement plan. If you plan on operating a partnership or corporation, you'll need to submit an EIN.

Keep track of expenses you incur before you start your business. Expenses incurred once you decide to start a business, but before business operations actually begin, are deductible up to $5,000 in the first year of business. The rest is deductible over 180-month period after your business opens its doors.

Tax Tips Small Business

  • Clothing for Your Job is Not Always Deductible

    Understanding the rules

    Many taxpayers are required to maintain a certain personal appearance or wear special clothing for work. However, not all your purchases for work-related attire or personal grooming reap a tax deduction. If you are required to wear a uniform or other special clothing that has the name of your employer or some other logo on it, that cost is deductible as a miscellaneous itemized deduction.

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Small Business Quick Tip

  • SS Wage Base

    The Social Security wage base increases to $118,500 in 2016. This means that you are no longer required to withhold social security tax for employees after meeting this threshold. However, you are required to withhold Medicare taxes regardless of the amount of wages paid.
Saturday, 15th December 2018
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Tax Tips Personal

  • Public Safety Officers Get a Tax Break

    Tax savings for health care costs

    Beginning in 2007, retired public safety officers, or those who have separated from service due to disability, get a tax break for health care costs. If you are a retired public safety officer,

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Personal Quick Tip

  • HSA Contributions

    Contributions to a health savings account (HSA) must be made by the due date of your tax return excluding extensions.