You may be like many American business owners – procrastinating on filing your 2009 taxes – but there are good reasons to get a move on. Whether you’re due for a refund or just looking to reduce what you owe, remember that the early bird gets the worm. For instance, in California, a tax credit is available for small businesses that had more qualified full-time employees when they concluded the year than when it began. Featuring payouts of up to $3,000 per worker, the down side is that the program is only funded until its $400 million allotment is expended.
There are also tax delays and deductions available for businesses that gained debt forgiveness or showed a loss in 2009. In some circumstances, small companies can amend their returns from prior profitable years to gain a federal refund now to offset 2009’s losses. These are ways that Washington is trying to help financially stressed companies to turn the corner.
Fluctuations in the tax law can impact a business owner’s credits and deductions. Credits are applied against what a business owner owes in taxes; whereas deductions decrease the amount of income that can be taxed. The federal government often reviews the possibility of incorporating new credits, such as those to support businesses that are hiring.
With the intricate opportunities available, it’s more important than ever for small-business owners to stay abreast of the tax law (or to hire qualified personnel to handle their tax matters). In addition, they should also keep meticulous records of their finances, particularly for those expenditures that may end up impacting their taxes. This can also aid them in business decisions such as when it’s advantageous to invest in new equipment or personnel.
The Internal Revenue Service Web site, www.irs.gov, offers business owners a list of last year’s tax changes. An additional resource for business-related deductions can be found at www.irs.gov/businesses/small.
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Source:
Los Angeles Times: This year, delaying taxes can be particularly costly
