[Note: Here’s a free marketing tool. Include this sheet of helpful year-end tax tips in holiday cards to current and potential clients. Just copy and paste this into your word processor, delete this note, and the one at the end, add your contact information and prepare to celebrate a happy new year of business.]
I’m proud to be paying taxes in the United States. The only thing is—I could be just as proud for half the money. –Arthur Godfrey
As the year winds down, there are a few things you can do in order to save your business some money. Here are five tips to help you maximize your 2012 tax benefits:
1. Defer income. Each and every penny you make up until December 31st of this year will be included in your 2012 taxable income. Deferring payments to the beginning of January will save you some money in taxes.
2. Make charitable contributions. ‘Tis the season to give. It’s important to check your list twice and see if any of your charitable contributions can come at the end of this year rather than the beginning of next. This will maximize your 2012 deductions. Just be sure to keep your receipts.
3. Increase expenses. Don’t procrastinate buying office supplies until next year; all year-end expenses are tax deductible and could save you a considerable amount come April, 2013. Look to things you’ll be using soon, including office supplies and equipment. Also consider paying January bills early.
4. Check for inventory write-offs. Look through your inventory to see if any products are damaged or outdated. Noting market-value loss could provide you with additional tax deductions.
5. Contribute to retirement plan. Small business owners should recognize that being your own boss means you are responsible for your own retirement. If you haven’t started contributing to a retirement account, now is the time. All contributions are tax deductible. And if you do have a retirement account, year-end contributions are a great way to boost your deductions.
Professional Tax Preparers can help you get the most from your yearly tax filings. But truth be told, they’re even more valuable when you enlist their help in year-round tax planning. Any good tax preparer worth his or her salt will save you more in taxes than they charge you in fees. Don’t wait to see how much a tax preparer could save you.
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