With only two months left in 2019, it is officially time to start your 2019 tax planning to prevent you from overpaying. What you do not want to do is spend extra money elsewhere in hopes to save on your tax bill – that will not help in the long run. Here’s what you need to do for your business before the end of the year.

Tax Tip #1 – Speed Up Depreciation

Accelerated depreciation is a key concept for business owners to understand. Depreciation depends on the useful life of an asset. If the asset is purchased for $15,000, and its useful life is 15 years, ordinary depreciation would imply that $1,000 is expensed in each year. On the other hand, accelerated depreciation is more profound in that the useful life of most business assets is not made to fall in line, which in turn places a majority of the asset’s expenses within the first few years it is used.

For 2019, the limit for Section 179 has been increased to over $1 million. Under the rules of Section 179, entity expenses on HVAC, security systems, or other kinds of business equipment or software can reach up to $1 million. Given that you purchase these items before the end of the year, you could be eligible to receive a tax write-off on your 2019 taxes. In order to get the write-off, though, there are several rules to make sure you are following, including some limitations and exceptions. Talking to one of our professionals is worth the effort if you are looking to purchase equipment or software, work out tax decisions, and/or completing IRS tax forms.

Tax Tip #2 – Get In As Many Deductions As You Can

A tax deduction is also referred to as a “tax write-off.” This is an expense that can be deducted from your taxable income. To crunch the numbers, you will need to subtract the amount of your expense from your taxable income. Tax deductions allow you to pay smaller tax bills as long as the expense meets the IRS tax deduction criteria.

Before the end of the year, your business needs to get in as many deductions as it can. A great way to do this is to move some of your typical expenses that are due next year into this year, then move some of your income from the current year into the new year. It is best to consult an advisor before claiming any deductions on your tax returns.

Tax #3 – Get A Second Opinion

Having an advisor evaluate and review your tax plans and decisions before the end of the year will prevent you from overpaying your taxes. Meeting with one of our advisors can save you money and prevent loss. Being the founder and owner of your own business is complicated, and we’ve got you covered. Visit our website today to learn more about how we can help you with tax planning before the end of the year.