How to Save Money on Small Business Taxes

If you are running a small business, you have the right to pay the required taxes and nothing else. In
fact, in most cases, your small business may eligible for tax exemption. Most small business owners
are unaware of these exemptions and end up paying more money taxes than required.

Being an entrepreneur, you should be careful and grab every tax-saving opportunity available
through deductions, credits, depreciation, and payroll-tax reduction. Instead of paying
unnecessary taxes, you can pay only the required ones and keep your profits.

Following are some tips to save more on your taxes:

1. Check with a Qualified Tax Advisor
You are new in the business and confused when it comes to the payment of taxes. This is quite
normal. Before you make any major decision, you are advised to consult a qualified tax
professional. It can positively impact the business's tax return and spending on un-required
taxes.

Choose a tax consultant who is available throughout the year, especially at the time of the tax
payment. Hire an expert who can represent you and your small business in front of the IRC or the
tax authority in your country.

An enrolled agent might be the best option. These enrolled agents are designated by the IRS, and
they have qualified for a strenuous, three-part test, and they work for the IRC at the same niche.

2. Timing the Income and Costs
Timing is important for small businesses for their success. The timing of income involves the
movement of income from one year to another year. Firstly, select the year in which you aim to pay
the most in taxes.

Secondly, reconsider the current expenses before the year comes to an end. It is also advised to pay
a part of that amount so that the income of the current year is less than the expense. Also, a
business can increase its expenses and decrease income legally by making some expenditures,
including stocking up on supplies or paying the office utility or rental bills in advance.

3. Set Up a Retirement Plan
Setting up a retirement plan for yourself and your employees is an excellent way to save on taxes.
This can saves money on taxes. However, the retirement plan must be a qualified plan, so to gain
maximum savings on taxes.

For this purpose, the retirement plan must be recognized by the IRC to allow deferment on taxes on
the earnings till the earnings are withdrawn. These include IRA s and proper plans of contribution.
This is a normal practice done by most of the businesses these days not only to gain more from the
taxes but also to keep the employees loyal to the business.

4. Avail Tax Credits
Tax credits are exemptions from tax offered by the government if your business meets certain
requirements. It is a technique used by the government to reward individuals and small businesses
for good tax behavior. It encourages entities to pay taxes on time and follow good tax practices.

For example, Carpet Cleaning London takes tax credits for hiring employees, uses recycled
resources, provides access to disabled employees and the general public, and also provides health
coverage for the workers.

You can check with your local, state, or federal tax authorities to see what requirements are
mandatory to become eligible for tax credits.

5. Avail Tax Write-off on Equipment and Vehicles
Small business owners can take tax write-offs on the purchase of equipment, other machinery,
and vehicles. At times a small business can also take a tax write-off on the purchase/renting of
real estate property.

These write-offs can either be taken in the first year after the equipment or machinery is bought or
later. Did you know that the two basic types of accelerated depreciation are Section 179 deductions
and bonus depreciation?

This kind of depreciation is applied immediately when the machinery or vehicle bought comes into
service.

  • Bonus Depreciation:

This kind of depreciation is an extra benefit for the bought assets. From September 27, 2017,
through January 1, 2023, The TCJA also maximized this tax break from 40% to 100% of the cost for
assets when used.

6. Minus the Costs of the Gifts
A small business owner can also minus the costs of the gifts given to the stakeholders, including the
customers and vendors. This deduction can go up to $25 per person. However, an exception is
always there, for instance, for your business franchise.

Subtracting the costs of amusement or refreshment is a bit problematic if an entrepreneur shows
his appreciation by paying for quality time. These costs are not included unless the amusement
event t is directly related to the business.

7. Deduct Car Expenses
You can also deduct car expenses from your tax payments. What a wise entrepreneur should do is
that instead of showing the actual car expenses, they should only show the standard mileage rate
set by the IRS.

For 2012 the rate was 50 cents, and for 2013, the rate is 52 cents. A small business owner can
minus every mile that they drove in the car for business-related work, even if it is in their
personal car.

Keep a logbook so that when claiming the deduction, it is easy to look at the total number of the
trips, areas of the trip covered, and what were the readings of the odometer.

8. Hire your Family Members
Hiring your family or friends in your small business can help the business owners to save a lot on
taxes. Instead of giving your family members or kids after the tax money, why don’t you hire them
in the business? Hiring them would be helpful.

They would do real work. For the tax year 2013, a business owner can pay them up to $5,900 per
year that they collect tax-free, and it gets canceled by the standard deduction. The owner might
pay payroll taxes for them since the business can expense the family members of the kid’s payroll
and minimize the taxes.

Final Thoughts

For small business owners, the above tips must help save money on taxes, but it is to be noted
that these tips are not intended to be tax advice in actuality. These are just the ideas that can help
them in saving more.

These are items to consider when working with your tax clients as their Professional Tax Preparers offering quality accounting services.

Contact Universal Accounting School to discuss how we can help your small business succeed.

Author Bio:
Shaheryar provides ghostwriting and copywriting services. His educational background in the technical field and business studies helps him in tackling topics ranging from career and business productivity to web development and digital marketing.

How to Get a Tax License

If you’re thinking about getting a tax license, you’re on track for a lucrative addition to your career. Becoming a certified Professional Tax Preparer is an excellent step toward a satisfying financial future. Many people obtain their tax license and use it as a stepping stone to other opportunities, such as owning a tax services business. Simply including tax preparation skills on your resume and getting a tax license is an excellent pathway for advancing your current career.

Universal Accounting leads the way in small business tax training and is approved by the California Tax Education Council (CTEC) to offer the Professional Tax Preparer (PTP) certification as a distance learning course in California. Universal Accounting offers a money-back guarantee. If you aren’t satisfied with your tax preparation course, you can simply return your materials and receive your money back.

What Is IRS Tax Certification?

An IRS-certified tax preparer has unlimited rights to represent their clients in front of the IRS. Because IRS preparation is detailed and constantly changing, IRS-certified tax preparers can help clients better navigate the complexities of the system, including tax payments, audits, and preparing appeals in the event of an IRS error. Certified tax preparers are consultants who have a right to be paid for the work they perform for clients.

When you choose a reputable tax preparation certification course, it will include current information on tax laws. It will also prepare students for changes in tax laws for the upcoming years. The course will train students in state and federal tax forms and how to prepare them accurately.

I Want to Become Certified: What’s Next?

Tax preparers don’t have to be IRS-certified to work with clients and be compensated for their work, but certification is the best route to take if they plan to pursue a career in the field. Not only can certification increase future salaries and add more opportunities to the table, but it can also increase demand for services.

Certification is possible through IRS-approved educational training courses. Those interested in taking the next step in certification can find official courses listed on the IRS website. It’s essential to ensure the IRS has vetted the courses to make the certification official in the government’s eyes.

Luckily, modern technology has made hands-on tax preparation education more accessible and flexible than ever before. Online courses are a convenient way to enhance education while juggling family life and work responsibilities because they are available on-demand, day or night.

After you make the choice to pursue your tax license, it is time to find the program that is right for you, aligns with your goals, and is within your means.

How to Choose a Program

Students pursuing an IRS certification should keep a few things in mind when searching for a program. First and most importantly, the educational provider has to be listed as an IRS-approved course provider. Other aspects include:

  • Official “PTP” designation
  • Educational tuition assistance if necessary
  • Individual counselors
  • A timeline that aligns with their goals
  • Business coaching after completion

These aspects will help students set themselves up for success in the next phase of their careers.

Partnering with an organization such as Universal Accounting is an intelligent way to get started with a training course that encompasses all the aspects of a great program and is IRS-approved. The Professional Tax Preparer certification is a self-paced online training to prepare personal and business taxes and prepare students for the IRS’ enrolled agent (EA) exam.

The best certification programs support students after completing courses by partnering them with coaches and mentors with real-world experience. This additional training is invaluable to those looking to grow in the profession. The teachers and coaches at Universal Accounting know what it’s like to be successful tax preparers because they have experience in the field.

Reasons to Consider an Online Program

When students choose online tax education courses, like those offered by Universal Accounting, they can expect to learn via workbooks, videos, and various other reference materials. High-quality online courses are cutting edge and will include many elements of visual learning, as well as self-paced. This means you can return to materials and watch them again if needed.

Universal Accounting also offers instruction provided by experts in the tax and accounting fields. Students can expect to participate in real-world scenarios, which will help them prepare them firsthand for what it’s like working in the field.

What Happens After I’m Certified?

After certification, the next step is to receive recognition from the IRS. The first step will be an IRS preparer tax identification number, or PTIN. Registration is simple—visit the IRS website and register online for the PTIN in about 15 minutes. The application takes between four and six weeks to process. Once the number is official, certified tax preparers can use the number on forms and market themselves to clients as IRS-certified. This designation tells clients they will receive exceptional service and confidentiality and tells the IRS the tax preparer understands the complexities of their business.

In addition to the PTP and PTIN number, many tax preparers take an extra step to affiliate themselves with professional organizations. These memberships can carry weight for business owners running their firms or on resumes. Some of these include:

  • National Association of Tax Professionals
  • National Society of Tax Professionals
  • American Academy of Attorneys
  • American Institute of Certified Public Accountants
  • National Society of Accountants
  • National Association of Enrolled Agents

These organizations are very picky with memberships and are an excellent way to show commitment to excellence in the field.

Ready to Get Licensed? Contact Us Today!

If you plan to grow in your career or start your own accounting business, certification is an essential part of the accounting and tax preparation industry. The extra step establishes credibility and trust that will far outweigh the costs.

Tax preparation will always be in demand, and Americans dreading tax season each year will appreciate a professional in their corner. Start your certification journey today. Contact Universal Accounting for more information.

4 Practical Tips for Entrepreneurs With Children and Disabilities

Being a parent who is living with disabilities can come with some unique challenges, especially if you have dreams of opening your own business. Figuring out how to get your business and up and running is just one, but you also need tools that will help you balance the needs of that business with the needs of your family. Not to mention your own needs. If you’re a parent with disabilities who is looking to start your own business, these pointers can definitely help. 

 

Boost Your Business Skills With Online Training

 

Before you start your business, consider completing a few courses to help you better understand the process.  The online format will give you the flexibility that you need as a busy parent while providing you with leadership skills, self-awareness, and self-confidence. All of which can be essential for establishing a successful new business of any size. If you’re concerned about costs, know that there are financing options designed to help you. To further sharpen your prowess as a business owner, also consider taking online accounting training from Universal Accounting School. 

 

Develop Flexible Plans for Your New Business 

 

With some training under your belt, you will be ready and competent to move to the next step and write a business plan. Business plans can be tricky for smaller startups, especially if you want to develop plans that you can actually use to fuel your success. As you start your general business plan, try to think about the needs and wants of your target audience, and then write with them in mind. Although details can be important, you should also try to keep this initial roadmap short and concise. As long as you have a few key elements, including a marketing plan, you should be all set to start your small business with confidence. Just like your overarching business plans, marketing strategies should be tailored to fit your target customers. Speaking of target customers, it’s also a good idea to ensure content is accessible, to connect with other folks living with disabilities.

 

Set Up Your Accessible and Functional Workspace 

 

Most first-time business owners end up working from home, at least in the beginning. Since you will be working from a home with kids around, organizing a home workspace could be a smart move for your productivity. Bonus productivity points if you can set this office up in a room or area of your home that is free from distractions and interruptions. A spare room with a door is always the best bet but if you’re short on space or need to keep an eye on little ones, setting up your workstation against a wall can also work. Depending on your needs, you may also need to design this space with accessibility features in mind. For example, opting for a desk that can be easily adjusted to varying heights can make home offices more practical for those who use a wheelchair and embossed labeling can help those with low vision keep workspaces organized.

 

Create Routines That Work for You and Your Family 

 

While working from home can provide the practicality and flexibility you need to care for your family, this sort of arrangement can also come with some challenges. Establishing clear routines and expectations for every member of your household can help reduce the stress of these challenges. So start with your family’s morning routine and work your way down from there. While structure can be key, it’s also helpful to find the right balance of flexibility and structure for your family’s needs. If anxiety starts creeping in, you may want to work in a few more breaks for rest, exercise, and family time. Once you have a schedule worked out, post it in your family’s command center, so you won’t have to remind kids about to-do’s and expectations. 

 

Running a successful small business isn’t for the faint of heart. As a busy parent and someone living with disabilities, you’re already used to conquering challenges. So with time and know-how, you can easily turn those skills into incredible assets for your new business! 

 

Photo Credit: Pexels

From Ministering to Serving as an Accountant

For Clay Glassford life has purpose and meaning, who knew the adventure he would take when he decided to become an accountant. With a decision, hours of committed study he found the confidence to start his accounting business and has not looked back since then.

Listen in as Roger and Clay discuss this journey and the impact it’s had on his life in a positive way.

Clay shares some tips and advice that apply to everyone starting and building a successful accounting & bookkeeping business.

Learn the turnkey process to having the premier accounting firm

Become a Professional Bookkeeper

Become a Profit First Professional

Mitul Mehta, From a Kid Who Loved Numbers To CPA

Although his parents wanted him to become a doctor or lawyer Mitul Mehta was drawn to numbers. Imagine writing code before you were a teenager.

Although Mitul received his degree in accounting his career path went the route of technology and consulting. Imagine that background leading up to his wife starting her business and asking him to take care of the books.

Now Mitul has a thriving accounting business offering traditional accounting services coupled with technology and consulting.

Listen as Roger Knecht, president of Universal Accounting Center, and Mitul Mehta (https://www.cpa-mehta.com/) discuss his business, the advice he has for others as well as the future of accounting.

Learn more about becoming a Profit First Professional

Become a Profit & Growth Expert

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