Save on Taxes While Growing Your Business

Your Guide to State, Local, Federal, Estate + International Taxation

It’s a worthy goal; one that most all business owners would like to achieve – growing your business while at the same time saving on taxes. It can be done and the IRS gives us some amount of incentive.

Consider investing in new equipment. More, better, newer, more efficient, perhaps? Sooner or later, it’s likely that your business will need to invest in new equipment if it’s going to grow. Through 2014, via IRS code section 179, most businesses could utilize a flat out tax deduction of up to $500,000 for purchase of qualified new equipment. While that $500K limit is reduced to $25,000 for tax year 2015, don’t count out a retroactive restoration of a higher limit as Congress has been known to do with this and other tax provisions. Keep your ears open on this one.

While investing in hard assets is often necessary to grow your business, so is investing in your human capital. After all, what good is your new equipment without the right people to operate it? A good employee benefits program set up right can help you invest in and retain quality employees essential to growing your business, while at the same time providing tax benefits for your business. Learn about the multitude of qualified retirement plans, deferred compensation plans, Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs), Health Reimbursement Accounts (HRAs), and other Fringe benefits the IRS allows deductions and tax credits for.

Finally, here’s one that’s right on point. The New Markets Tax Credit Program provides an incentive for business owners to grow their businesses into low income communities and claim up to 39% of the initial investment as tax credits.

By Dale F. Jensen, CPA