B A L CONY. Minimizing Tax Liabilities for Small Businesses. Rosemarie Klotz. Tax Tip #1.
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DEPRECIATION VS. EXPENSEIf you buy new business equipment, under Section 179 of the Internal Revenue Code, you can expense up to $250,000 of your purchase this year if thetotal purchase is not greater than $800,000, instead of depreciating it.
Rehabilitation credit available for restoration of qualified business buildings and certified historic structures…
Disabled access credit for bringing facilities into compliance with the Americans with Disabilities Act.
Credit for providing low income housing.
Credit for developing orphan or generic drugs.
Credit for using alternative fuels.
Disaster relief when an area is declared a national disaster – includes special casualty loss provisions, filing extensions, and more.
Energy credits for construction of energy efficient homes, manufacture of energy efficient appliances, and more.
Alternative motor vehicle credit – for qualifying hybrid, fuel-cell, plug-in electric, and other alternative motor vehicles used for business.
Credit for pension plan start-up costs. (Plan contributions funded by employer are also deductible).
Work Opportunity Credit for hiring certain targeted groups including unemployed veterans, individuals living in disadvantaged areas, and disconnected youth (age 16-25) not attending school or employed.
Credit for employer-provided child care facilities and services.
Worker, Homeownership and Business Assistance Act of 2009– companies can offset losses from 2008 and 2009 against profits as far back as 2004.
Friendly warning :In order to close tax gap, the Internal Revenue Service has hired many new agents to focus on small business owners. The focus will be on the maintenance of back-up documents for expenses.