Our Top 10 Tax Tips for Small Businesses

  1. Consider The Installment Method When Selling A Small Business. Reporting the sale of your small business using the installment method can save significant amounts of federal income tax, and provide flexibility to both seller and buyer.
  2. How Should You Set Up Your New Business? If you are forming a small business, you face several choices: Sole Proprietorship, Partnership, C-corporation, S-corporation, Limited Liability Partnership and Limited Liability Company. Here are the basics.
  3. Using a Loss to Your Best Advantage. The Net Operating Loss (NOL) rules, including carrybacks and carryforwards, are very important and often misunderstood.
  4. What’s the “Right Amount” of Compensation for an S Corporation Shareholder/Employee? The S corporation has been used by small business owners to avoid payroll taxes, and the IRS knows it. Here is a case that describes how a CPA got into trouble with his own S corporation–and how you can avoid the mistakes that were made.
  5. Excluding Gain on Sale of Personal Residence/Home Business. How do you account for gain from the sale of your residence if you have used part of it for business? What if you own a home with someone to whom you are not married? Can you exclude gain from the sale of land on the lot your residence occupies?
  6. The Home Office Deduction: Know the Do’s and Don’ts. Tax rules regarding the home office deduction have changed a lot over the years, so be sure to review before claiming the deduction.
  7. 1-2 Punch Hits Family Corporation. Make Sure it Does Not Hit Yours. A decision of the First Circuit Court of Appeals reminds us of the need to carefully monitor and document both compensation paid to Shareholder/Employees of family owned C (regular) corporations and accumulated earnings in such entities.
  8. The Tax Treatment of Country Club Dues. Can you deduct your country club dues? What constitutes legitimate business deductions?
  9. Where is Your Business Tax Home? You may know where you live, but if you’re one of those frequent travelers who is always on the road, the IRS may rule that you are “homeless” from a tax standpoint. How could that affect your travel deductions?
  10. Check Your Tax Accounting All Year Long. There is a very helpful feature on this online office that will help you during tax season. It is absolutely necessary once you hire employees and begin payroll operations.