4 Ways to Reduce Your Business Tax Liability with CPA Firms in DFW
Since tax liability is a major expense for many businesses, it’s a smart idea to utilize CPA firms in DFW to explore your options for reducing your tax obligation. Strategic business moves, yearlong tax planning, and better timing of your purchases are just a few ways to lower your taxes.
Many business owners don’t know what to do to reduce their tax bills or aren’t sure where to start. Here are some wise moves that CPA firms in DFW can help you make.
- Use Tax Deductions to Your Advantage
One of the most effective ways to lower your tax liability is to maximize your use of tax deductions. Tax deductions lower your taxable income and your final tax bill.
Some business owners don’t know what expenses they can deduct or may be leery of deducting items that can increase their risk of an audit. It’s common for business owners to avoid taking a deduction for their home offices due to a misunderstanding of the tax code or out of fear of drawing attention from the IRS.
CPA firms in DFW, like Gurian CPA firm, thoroughly review your financial information to ensure you’re not missing valuable deductions. They’ll also make sure you have the paperwork to support and substantiate a deduction in the event of an audit.
- Rethink the Timing of Your Purchases
Another alternative to lower your business tax liability is to revisit the timing of your purchases. When making a business purchase, the purchase lowers your taxable income for the tax year that you make the purchase.
If you know that your income is going to be higher than normal this year, it may be better to accelerate purchases so that they occur during the current tax year. Or, if you anticipate income growth during the next tax year, you might want to delay large business purchases to mitigate taxes associated with your increased income.
- Consider a Different Business Structure
Some businesses may benefit from adopting a different business structure. For example, incorporating your business as an LLC (limited liability corporation) can help you lower your Medicare and Social Security taxes. A CPA firm will help you determine the best structure for your business.
- Enhance Employee Compensation
Employees are a valuable component of a successful business, and monetary rewards are an effective way to demonstrate how much you value their hard work. Not only do end-of-year bonuses increase employee satisfaction, but they decrease your taxable income.
Bonuses and wage increases allow you to invest in one of your company’s most important resources while simultaneously lowering your tax bill.
Need help from CPA firms in DFW to reduce your business tax liability? Contact Gurian CPA firm today!
