Our sister company, SBS Accounting & Advisors, held an event last month in Marietta, Georgia, on the topic of “3 Must-Know Year-End Tax Strategies.” Our own Phillip Focaracci, CPA, Senior Tax Lead, highlighted three main areas where you could reap tax savings as we near the end of the year.
First, there are several types of accounts that have tax benefits. Among these are health savings accounts, or HSAs, which can be a big winner for small businesses and their owners. Not only are they a powerful way to save for healthcare expenditures, but they also are a one-of-a-kind tool for tax savings.
Numerous kinds of retirement accounts have tax advantages too. For example, contributions to a traditional IRA may be tax deductible, but do have annual limits and deadlines. Additionally, there are SEP IRA and Solo 401(K) accounts that can be beneficial for business owners and other self-employed individuals.
It’s also possible to do what’s known as tax loss harvesting with investment accounts, where you can offset capital gains that you incurred during the year by selling investments that are in a loss position by December 31.
Second, business owners sometimes overlook deductible expenses or may fail to maximize those expenses to reap the full benefits they’re due. Examples of tax deductions that fall into this category include the home office deduction and the deduction for owners who employ their children.
Third, business owners sometimes are eligible for, but fail to get the pass-through entity tax election (PTE election), because either their company is not set up as a flow-through tax entity, or because they simply aren’t aware the PTE election exists.
It’s a gross understatement to say that the federal tax code is complex. But we’re here to help. Contact us today to set up your tax planning appointment. Call us at 706-632-7850 or email us at help@sbsaccountants.com.