Now that another tax season is wrapped up and the impact on your business is top of mind, consider taking some time to evaluate whether your tax strategy is supporting your business goals or whether you should consider making adjustments. (Even if you filed an extension for your 2023 tax returns, it’s still a good idea to check in on your tax strategy to maximize what you can do in 2024.)

First, conduct a thorough review of your 2023 tax returns. Were you happy with the outcome? Did you pay more in taxes than you expected? Did you take maximum advantage of tax deductions and credits? What changes would better help support your business plans for 2024 and over the long term?

Next, consider your business growth strategy. Is your business expanding? Do you plan to invest in new assets or hire more employees? Are there tax opportunities to support your goals?

Also, take a closer look at your estimated tax payments. If your business income is fluctuating, you may need to adjust payments accordingly. Remember that estimated tax payments are not set in stone. They can and should be adjusted based on changes in income, expenses, or changes in tax law.

Finally, be proactive so you can maximize opportunities to reduce tax liabilities. Some things to consider:

• Is it time to upgrade or expand your facility and take advantage of beneficial tax treatment for energy-efficient renovations? Security and HVAC systems, fire protection systems, and structural improvements to non-residential buildings may qualify for a Section 179 deduction.
• Do you need new (or used) equipment? Most small and medium-sized businesses qualify for Section 179 deductions for the cost of office furniture and equipment; computers and software; certain vehicles; machinery and equipment and other property used for business. Just be sure to put any eligible purchases into service before December 31, 2024, to be eligible for the 60% bonus deduction (which drops to 40% in 2025; 20% in 2026; and expires thereafter).
• Are you stepping up research activities and maximizing related payroll tax credits you may be eligible for?
• Are you staffing up? Hiring targeted workers can earn tax credits for your business.
• Should you offer a qualified retirement plan, a Section 125 plan for health and dependent care expenses, or educational assistance (which can also be used to pay off student loans through 2025)? Not only will these benefits support recruitment and retention, but your business can get a tax deduction for contributions.
• Do you have an accountable plan for employees’ business expenses? Should you? You get to deduct the expenses and you and your employees don’t have to pay withholding or FICA taxes (as reimbursement is not treated as income).

While April 15th signifies the end of tax season, it should also mark the beginning of proactive tax planning for the remainder of the year. To ensure your business is taking full advantage of all tax benefits and staying compliant with changing tax rules, RBT CPAs is here to help.

Make the most of the rest of 2024 when it comes to your tax strategy, credits, incentives, and deductions. Schedule a tax review and planning session with one of our tax or advisory professionals, click here. That way you can find out how we can be Remarkably Better Together.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.