Running under the gun to save money on your taxes? Read on!
April 15 is still the annual tax deadline for many small businesses although, unlike individuals, small businesses can have varying deadlines depending on the type of company, the state the taxes are filed in, and other factors. Quarterly estimated tax payments are generally required throughout the year. And certain types of small businesses had to file by March 15.
Since business tax filing is complex, most experts recommend small business owners work with a professional tax adviser rather than trying to file on their own or even with tax-filing software. To learn more, you can visit the Small Business IRS FAQs at this link.
Read on for our top tips to find money if you haven’t already filed your taxes.
As part of the American Families and Workers Act of 2024, it includes a bill extends the 100% Bonus Depreciation for small businesses. For background, businesses were permitted to claim 100% bonus depreciation in 2022 for qualifying assets placed in service in 2022. But then, the rate decreased to 80% in 2023, and was set to drop to 60% in 2024, 40% in 2025, 20% in 2026, and zero in 2027. This legislation would allow businesses to claim 100% bonus depreciation for investments in machines, equipment and vehicles for tax years 2023, 2024 and 2025, providing a retroactive tax benefit for 2023.
So, if you qualify for Bonus Depreciation, you may want to extend your tax filings to see if this happens.
The US Chamber of Commerce put together this comprehensive list of 9 Commonly Overlooked Small Business Tax Credits. Check the link to see if your business qualiifes.
In the past, underpayment penalties hovered at around 3%, but this year they’re more than double at 8%. That’s because the penalties are based on the federal short term interest rate plus three points, so when interest rates are up so are underpayment penalties. It's best to pay what you think you owe or filing an extension vs incurring extra interest.
The best way to save on your taxes every year? Ditch the chaotic pile of receipts and keep your finances in a database so you can easily categorize them and stay on top of quarterly estimated payments. With an AI assistant like Palm, you can connect your business accounts and we’ll not only help you save money on your expenses, but you can store all of your business documents on Palm as well to keep organized. Create your free account today.