Small-business owners may also benefit from certain tax strategies implemented at the end of the year. Of course, any new legislation may have a substantial impact. Accordingly, here are several ideas to consider: Section 179 deduction: Under Section 179 of the tax code, a business may “expense,” or currently deduct, the cost of qualified assets…
Year-end tax planning is especially complicated this year. Reason: As a general rule of thumb, individuals may try to accelerate deductions into the current year and defer income to the next year. But income tax rates are scheduled to increase in 2011. Furthermore, special tax reductions for long-term capital gains and dividends are scheduled to…
Contractors frequently experience cash flow problems. It’s the nature of the business. However, careful planning can help identify small problems before they become bigger, and adopting several simple cash management strategies can help contractors manage and control cash flow. Common Causes of Cash Flow Problems The causes of cash flow problems are many. For example,…
The Environmental Protection Agency’s (EPA) new Renovation, Repair and Painting Rule affects contractors involved in renovating older homes and other buildings described as child-occupied facilities. The rule, issued April 22, 2008, and effective on April 22, 2010, is intended to reduce incidents of lead poisoning among children known to be caused by the presence of…
Small Business Health Insurance Credit The new health care reform law offers a tax credit to small businesses that provide health care insurance coverage to their employees. The new law allows a small business to claim a federal tax credit of up to 35% of the amount the business spends on health insurance for its…
Suppose that your child needs an after-school job while your company is looking to hire extra help. Practical solution: If you are in a position of authority, you could put your child on the payroll. There are several tax incentives for hiring a child to work for your business. In effect, you are “splitting income,”…
Despite the recent nationwide real estate slump, you may realize a significant gain if you sell your home, particularly if you bought the place before prices soared in prior years. What about the tax consequences? Generally, the amount of the proceeds is subject to tax at capital gain rates. Currently, the maximum tax rate on…
The new health care legislation signed on March 23, 2010—the Patient Protection and Affordable Care Act—will dramatically alter the landscape for small-business owners in the coming years. One critical change: Beginning in 2010, a business may qualify for a special tax credit that can partially offset rising health insurance costs. The new health care credit…
Suppose that your child needs an after-school job while your company is looking to hire extra help. Practical solution: If you are in a position of authority, you could put your child on the payroll. There are several tax incentives for hiring a child to work for your business. In effect, you are “splitting income,”…
Despite the recent nationwide real estate slump, you may realize a significant gain if you sell your home, particularly if you bought the place before prices soared in prior years. What about the tax consequences? Generally, the amount of the proceeds is subject to tax at capital gain rates. Currently, the maximum tax rate on…
