No business owner wants to pay more than their fair share of taxes, but the majority of them often do exactly that. In fact, approximately 85% of small business owners overpay on their taxes every year.
The problem is not that these hard-working individuals are lazy about taking every possible deduction or don’t mind overpaying. In most cases, they simply did not realize they were missing out on prime opportunities to reduce their tax liability.
To get the maximum benefit allowed by the U.S. tax code, consider adopting the following strategies to reduce your tax burden.
No. 1: Take Every Possible Deduction to Maximize Tax Savings
The primary reason this occurs is that they simply don’t know they’re eligible for certain deductions. And if their tax preparer doesn’t now – or if they use a software program for tax prep – they end up overpaying on their taxes year after year.
No. 2: Leverage the Tax Code to Reduce Your Liability
Maybe you already take every possible deduction to which you are entitled, but you can also adapt your business model and practices to become eligible for additional deductions.
This might involve modifying the legal structure of your business, implementing a retirement plan for your employees (or increasing contributions to an existing plan), or upping the amount you contribute to your own retirement fund.
You might be surprised to know that the U.S. tax code is written specifically to help small businesses (and their owners) thrive. When you stop viewing the IRS as the enemy and change your approach to doing business, you can optimize both cash flow and debt load, helping you achieve your goals for growth and success.
No. 3: Consult with a Small Business Owner Tax Expert
CPAs who specialize in tax matters may understand the complexities of corporate taxation issues inside and out but, often, they are not as well-versed in the issues that affect small business owners and self-employed persons. Likewise, using out-of-the-box tax prep software or budget chain tax prep services won’t help you find all the ways you can leverage the current tax laws to reduce your liability.
To legally reduce your liability, you need the help of someone who has in-depth experience with your specific challenges. CPAs who specialize in small business tax planning will have the expertise you need to maximize your savings.
In Taylorsville and throughout Utah, self-employed persons, highly compensated individuals and small business owners turn to Taxes Mastered for tax planning help. Our CPAs are experts in applying advanced tax strategies to minimize tax liability. Contact us today to schedule your free consultation and get started maximizing your tax savings.