8 Ways to Save Taxes Before Year End
Our SEWN SE Regional Director Greg Olson wanted to share some quick tips he came across in the Philadelphia Inquirer this past week.
Buy Capital Equipment - accelerated depreciation rules allow you to buy machines, vehicles, computers, software, furniture, and other types of capital equipment and, instead of having to depreciate these expenditures over time, you can immediately deduct up to $1,050,000 this year.
Make charitable contributions - your business can deduct as much as 25% of its income.
Clean up your balance sheet – eliminate long overdue and noncollectable receivables and discard old inventory. Write off these assets and take tax deductions.
Max out your retirement contributions – depending on your how much your employees are contributing, you can put away as much as $58,000 in your 401K plan.
Help employees with student loans – employers can take deductions of as much as $5,250 each year per employee through 2025 when helping with student loan payments and employees won’t get taxed.
Re-visit the employee retention tax credit – even though credit expired in September, you can amend your 2020 and 2021 federal payroll tax returns if your latest financial statements show you met the revenue decline standards for 2020 and/or 2021 compared against 2019 results. If eligible, this credit is as much as $7,000 per employee, per quarter.
Take advantage of the Work Opportunity Tax Credit – This credit was extended through 2025 and can reduce your taxes as much as $9,600 per employee, per year if you hire someone out the military, off welfare, out of prison, or has been unemployed for more than 6 months.
Pay your employees to get vaccinated – tax credits up to $511 per day for time missed for getting vaccinated, including additional time off if there are any reactions, are available.
Start off 2022 on the right foot. Contact SEWN for assistance in getting there!