This is the time of year to start thinking about your taxes and planning to minimize the bite that it takes. If you are a small business owner and find that you will be doing better this year than in prior years, you may want to set aside funds to pay any additional tax burden from the increased profit. You may want to consider making a contribution to a retirement plan.
This would also be the time to invest in your business. Do you need additional equipment? You may want to purchase it this year and take advantage of favorable tax treatments. In the same line, if you are an employee of a company, by putting more into your retirement account, you are reducing your taxable income.
If you have a tax accountant, she would be able to project your tax savings based on current information. However, as you know, Congress has been talking about major sweeping changes to the tax code before the end of the year. If that happens, it should happen sooner rather than later in the year and would most likely be retroactive to January 1, 2017.
Have you prepared your 2017 tax returns? You have until October 15th to file. However, the time has passed to pay your taxes. So, if you owe, you will want to prepare your taxes soon to stop the clock on penalties and interest. If you do owe, you have options such as an installment agreement to pay your taxes over time. But – don’t let this snowball. It is sometimes better to get caught up in this current year, rather than trying to pay the back taxes and have it snowball into 2017 tax year. Your tax accountant should be able to help you determine the best way to proceed and to plan for the future.
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