Tax Savings Ideas - Business

Question 1

Defer Income

Answer 1

• If you are on cash method you can delay end of year invoices
• You cant do this if you are on accrual method

Question 2

Bonus Depreciation

Answer 2

Can deduct 100% of costs till 2023

Question 3

Section 179 expensing

Answer 3

Can deduct 100% up to 1.05M for the first2.62 Million of property - put into place December 31, 2021

• Not computers or peripheral equipment
• less than 20 year equipment

Question 4

Qualified property

Answer 4

• property placed in service during the year
  -used 50% in business
• cant buy and dispose in same year
• Qualified improvement property - to interior of building - no enlargement of building, or an elevator, or internal structure
  Yes - roof, HVAC, fire system, alarm, security

Question 5

QBID

Answer 5

• sole and passthroughs trust and estates
• deduct up to 20% of qualified income
• Taxable income must be under 164K single and 330K MFJ

Question 6

Small Business Healthcare Tax credit

Answer 6

25 or fewer employees
50K average annual wage
the tax credit will help defray cost of employee health insurance

Question 7

Business energy Investment Tax Credit

Answer 7

• energy credits
• geothermal and wind
• solar

Question 8

Repairs

Answer 8

Year end repairs and expense should be deducted immediately - de minimum 2,500

Question 9

Depreciation Limitations

Answer 9

If you don’t claim Bonus - then the depreciation for luxury passenger vehicle is 10,200 for the first year

• passenger autos - $8,000

In combo is 18,200

• Heavy trucks - 100% bonus

Question 10

Retirement Plans

Answer 10

self employed - set these up

Question 11

Dividend Planning

Answer 11

By issuing a dividend you can reduce corporate profits and earnings

Question 12

Paid Family and Medical Leave Credit

Answer 12

There is a credit for this

• must have a written policy
• It ranges from 12.5 - 25% of wages paid to qualifying employees for up to 12 weeks of leave