Finding success when you own a small business can be a challenge. It requires grit and hard work. It also requires the help of qualified professionals in an accounting firm to help keep everything straight. Keeping your books organized can be beneficial in many ways. One includes your taxes. Taking advantage of all the tax credits that are available to small businesses is one way to succeed. There are often tax credits for small businesses that go unnoticed. Propel Your Accounting is here to point out some of these credits.
Small Business Tax Credits You Might Qualify For
One thing that small businesses often overlook is tax credits. Tax credits can help ease the tax burden that is placed on small businesses. Here are some of the most commonly overlooked tax credits you want to be sure you’re aware of:
– Research & Development Tax Credit: This tax credit is often overlooked because businesses automatically assume it is only for tech companies. However, if your small business is involved in developing new products, processes, or new software, you could qualify too. It is vital that there is detailed documentation of all the research you’re involved in to ensure you qualify.
– Work Opportunity Tax Credit: Another tax credit that can be beneficial to small businesses is the Work Opportunity Tax Credit. This is in place to help encourage small businesses to hire employees that might have barriers that keep them from getting employed. This might include a veteran, ex-felon, or someone on government assistance. Small business owners can be eligible for as much as $9,600 per qualifying employee.
– Small Business Health Care Tax Credit: It can be a significant burden for small businesses to offer health insurance for their employees. However, when small businesses purchase health care for their employees through the Small Business Health Options Program Marketplace, the tax credit can help cover as much as 50% of the cost for the employer to help cover the cost of premiums. There are some criteria that small business owners have to meet, so make sure you’re working with an accounting firm to make sure you qualify.
– Section 179 Deduction: While the other items listed above are tax credits, we would also like to mention the Section 179 Deduction. It isn’t a credit, but it can end up saving small business owners when the take advantage of it. This deduction allows small businesses to deduct the full cost of any qualifying equipment and other property purchases they make during the year. This could include equipment used for the business and even technology that is needed to run daily operations. It can help free up cash flow that can be used on future investments.
Bookkeeping, Accounting, Business Consulting & HR / Admin Services in the United States of America
If you are a small business, you can turn to Propel Your Accounting to help consult with you and handle not only your taxes, but also payroll, bookkeeping, accounts receivable, accounts payable, and more. Call us today!
