Schedule Your Year-End 2019 CPA Meeting Now

December 26, 2019 | 1,271 views

Schedule Your Year-End 2019 CPA Meeting Now
Schedule Your Year-End 2019 CPA Meeting Now

The end of the year is upon us. If you have not done so yet, schedule a meeting ASAP with your tax professional. This is the time when businesses of all sizes need to do two critical things: (1) determine if any last-minute tax treatments can be applied to minimize tax liability, and (2) based upon your budget for next year, determine how best to treat business income and deductions going forward.

Your CPA and tax professional should regularly offer ideas to improve your tax position, but at the end of the year, the timing becomes more influential. When you meet, be sure to specifically ask about these possible strategies to position yourself for the new year.

Donate to Charity. For most organizations, charitable gifts provide a tax deduction equal to the value of the property donated. Maybe it’s an old vehicle, computer, or functional equipment. If cash or property is available, a last-minute donation can reduce final revenue numbers and tax liability.

Add to Retirement Plans. As a small business owner, you probably have already established some sort of tax-protected retirement plan. If any cash is available in the business to contribute to such a plan, it may also reduce taxable income. Often, the contribution date can be pushed until the tax return due date too, so you have a little more time to find the money. However, the plan itself usually must be in place before the year-end. Ask your tax advisor how best to manage these funds. The added benefit, of course, is that you will be better prepared in the long run for retirement.

Purchase and Upgrade Equipment. If you’ve been planning to replace aging equipment, computers, software, or other items, it might be financially prudent to do it before year-end. The purchase can reduce your taxable income, and the business benefits by having more productive and efficient means of production to start the new year. Sometimes, we hold off on the inevitable purchases to save cash. At year-end, purchases can make a lot of sense. And the old, unneeded assets might also qualify as a donation.

Defer or Accelerate Revenue or Expenses. If you’ve had a highly profitable 2019, maybe revenue can be deferred until the calendar turns over to 2020. Maybe some products or services can be delayed until January. Likewise, the prepayment of an anticipated 2020 business expense now could be helpful. On the other hand, if 2020 looks to be a bigger revenue year, reverse these strategies to plan for the higher taxes that you anticipate paying.

Determine 2020 Tax Treatments. After considering the year-end tactics to use, review the coming year’s forecast and its impact on tax planning. Perhaps your industry has specific limitations or income thresholds to manage. Review new laws and requirements that influence your money management, and be sure your CPA knows the ins and outs of your industry to address such issues.

As the new year dawns, you must diligently review all possible ways to minimize your tax burden while carefully crafting 2020’s strategic plans. Don’t delay the meeting – with just a few weeks remaining, see your CPA or tax professional now.

Author Profile Jon Forknell is the Vice President and General Manager of Atlas Business Solutions, Inc., a software marketing company specializing in employee scheduling software, including ScheduleBase employee scheduling software, and other business software solutions. In the past, Jon has been recognized by the U.S. Small Business Administration as a SBA Young Entrepreneur of the Year. Atlas Business Solutions was named as one of Software Magazine’s Top 500 Software Companies in 2004 through 2007, and 2010, 2013, 2014, 2016, 2017, and 2018.

This entry was posted in Small Business Tips and tagged , . Bookmark the permalink.

Comments are closed.