written by David Myers
We will likely have a new tax code within days. The reform has passed, and we are simply waiting on a presidential signature.
Here are the top seven things you can do right now to take advantage of the new rules:
- Pay 2017 state taxes before year end. The state tax deduction is severely limited beginning January 1, 2018. Don’t wait until January 15 to pay your 4th quarter taxes. Pay them before December 31.
- Accelerate deductions. Rates for most businesses and individuals will go down in 2018. Pay deductible expenses prior to year-end while the rates are still high.
- Delay taxable income. For the same reason you accelerate deductions. On your individual return, compare next year’s rates to this years. You could be near a change in the tax brackets.
- Load up miscellaneous itemized deductions. These deductions are eliminated next year. It’s your last chance to deduct things like employee business expenses, dues, and tax preparer services.
- Buy business equipment or a SUV. The new law bumped up bonus depreciation to 100% of cost if the equipment is placed in service after September 27, 2017. It was 50% of cost before that date. The first 25k of a 6000 lb. GVW vehicle used for business can be written off.
- See if your business structure is built for the future. We recommend a review of your current structure in the next 60 days. Form of business operation is more important than ever. In some cases, you will be able to save more than 10 % of your business income by changing structure.
- Take a hard look at the building you recently bought or built. Tax laws have become increasingly favorable for real estate owners over the past few years. The new law is no exception. Discuss any newer projects or purchases with us. We can apply the rules properly to maximize your deductions.
Please contact us with any questions about your year-end tax strategy 417-881-0145.