10 Ways To Reduce Tax Burden For Your Small Business
Summary:
An ideal lawyer
will not just have a string of impressive credentials or gold lettering on his
door. He or she will be caring, concerned, and devoted to their work. You need
to think carefully before laying your trust in a lawyer after all in some cases
your life, future, money or property will be in his hands.
Keywords:
Legal Advice
Forum, legal advice, legal information, lawyers, laws, tax, legal insurance
Article Body:
An ideal lawyer
will not just have a string of impressive credentials or gold lettering on his
door. He or she will be caring, concerned, and devoted to their work. You need
to think carefully before laying your trust in a lawyer after all in some cases
your life, future, money or property will be in his hands.
Apart from doing extensive research to shortlist possible lawyers, you must
ensure that there is no conflict of interest, that you understand everything
the retainer agreement states, and that you have checked the references and
details regarding the practice.
You will know the lawyer you have chosen is the perfect one if:
1. He makes an effort to spend time to
understand your case himself. He will not assign a legal assistant to take the facts of the case down.
2. From experience and knowledge he
will know what is relevant and what is not. He will set aside and ignore
irrelevant facts, opinions, and personal emotions that cloud the case at
hand.
3. He will insist that the footwork for
the case be done thoroughly. All facts must be checked for accuracy and solid
arguments jotted down with the backing of earlier rulings.
4. He will not just focus on the
problem at hand but examine the problem from all sides. This will create a
complete picture highlighting all factors of relevance and the different ways
one can approach the case.
5. He will use his foresight and
anticipate moves by the opposition or opinions of the jury or judge and plan the way ahead. Like a master chess player, he will plan the case not by the day but
by many hearings ahead.
6. He will not waste time beating
around the bush or creating verbose statements—many words strung together which
look impressive but mean nothing. He will insist that the case and its
arguments be clearly stated.
7. He will be self-disciplined,
thorough, and self-confident. Courteous at all times he will respect you as
well as all the staff who work for him.
8. He is recommended by not just his
friends and relatives but by other professionals of good standing and from his
field.
9. He will not just present to you his
victories but be happy to tell you why and how he lost certain cases.
10. He will lay the cards on the table
and tell you clearly whether your case stands to win or lose. He will not
claim that winning is guaranteed. He will be honest and upfront about his
opinions and advice.
The bottom line is that the lawyer must be worthy of your trust. Use your
inborn instincts and don’t go by the lawyer’s good looks or fancy car or
office. After all, it is competence in law and in court that is of essence to
you.
Everyone worries about taxes and looks for ways and means of reducing the tax
burden. When you have a small business of your own you must update your
knowledge of tax laws that pertain to “small businesses.” As a business owner, you must understand clearly about accounting systems and tax planning. Sit down
with your accountant and plan on ways of maintaining business expenses, filing
receipts, planning on “tax saving” investments, and a strategy for running the business most beneficially.
Did you know that:
1. According to law you can reduce your
tax liability by hiring family members to carry out work in your business. Pay
your children and spouse to perform assigned duties. This way you can shift
from higher tax rates to lower ones.
2. Consider hiring independent
contractors instead of employees. You will save on payroll taxes. However, ensure that you meet the IRS’s criteria.
3. Think about “deferring income” and postpone receiving the money to January instead of December. This means that
payments received will be up for “tax” calculations a year away. However, ask your accountant’s advice as the
benefits are dependant on profit and losses for the year and your corporate
legal structure.
4. Take advantage of tax deductions
allowed for charitable donations. Make donations in November or December
instead of January so that you can include the donations for tax deductions in
the current year.
5. Maximize your expenditure on
equipment and office supplies. Buy in advance for a quarter and use the tax
deductions allowed in the current fiscal year.
6. Include expenses of business-related
travel in the current year.
7. Pay all bills due before the end of
the year. Payment for cell services, rent, insurance, and utilities related to
the business can be included for accounting and applicable tax waivers.
8. Plan a retirement plan and make
payments before the end of the year. This will reduce your income for the year
and proportionately the tax due. Be sure to check on the limits. Plan a
feasible and beneficial strategy with your accountant.
9.
Be sure to deduct from your taxable income money paid to license fees,
business taxes, and annual memberships to business related organizations.
Be sure to deduct interest paid on borrowings for running the business and
related fees. Insurance premiums paid to insure the business office and
machinery are eligible for tax deductions. Make a list of your memberships and
check which ones are eligible for tax deductions.
10.
Check whether you have deducted management and administration expenses
as well as money spent on maintenance and repairs of equipment.
Decide whether a cash accounting system or an accrual one will benefit your
business. The tax deductions are different depending on the system you use.
When setting up your small business take the advice of a tax and accounting
professional as to which accounting system would be most suitable.
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