All businesses seek to reduce costs, and year-end tax planning presents the chance for significant savings that affect your bottom line. After substantial changes to the federal tax code, businesses need to ensure continued compliance with new rules and understand how to optimize their tax liability for both 2019 and 2020. Depending on the type and structure of your business, this 2019 Year-End Tax Planning for Businesses Letter can help determine the opportunities for saving on year-end and year-round taxes for the following entities:
- • All businesses
- • Partnerships, limited liability companies, and S corporations
- • C corporations
Tax planning for businesses also entails determining how this impacts the individual owners, so we recommend reviewing the 2019 Year-End Tax Planning for Individuals Letter as well.
To fully grasp all the potential tax savings, each business must assess its total tax liability. This requires a review of the entire tax portfolio, including income tax, indirect tax, property tax, payroll tax and excise tax, as well as tax credits, incentives and customs and duties. This will help illuminate the total tax impact of decisions made across the business, providing a complete portrait of how these affect tax liability for the entire organization and individual owners.
Once you assess your business’ current financial posture and define a vision for the future, you can analyze the gaps and plan ahead. By determining the projected marginal tax rate for each year, you can weigh the advantages of accelerating income or deductions into 2019 or deferring them until 2020. Important considerations include:
- • Bonus depreciation and expensing rules
- • The new qualified business income deduction
- • Potential changes to your entity status
- • Compensation deductions
- • Business loss claims
Download full blog here: Baldwin tax planning for businesses 2019.pdf