Additional Tax Planning Considerations for Businesses
State & Local Tax Considerations
Businesses have numerous state and local tax matters to consider for compliance and planning purposes, including where income and sales are subject to tax, sourcing of income and the application of elective taxes that many states have for partnerships and S corporations.
Let us help you with your state and local income tax needs, including sales/use and franchises taxes.
Planning for What’s Next
Charitable Contributions
For tax year 2023, the maximum allowable contribution deduction is limited to 10% of a corporation’s taxable income. Flowthrough entities’ charitable contributions may be limited based on the owner’s taxable income. Careful planning is needed to capture the tax benefit potential of charitable contributions.
Retirement Plans
Have you revisited your company’s retirement plan lately?
Recent legislation has provided new opportunities to consider. We can help you look at retirement savings options to make sure that you are taking advantage of tax deductions as well as providing ways for employees (and owners) to save for retirement.
Employee Retention Credit (ERC)
The IRS warned employers to be cautious of third parties taking improper positions related to ERC eligibility, as claiming the credit inaccurately can result in severe consequences. We can help you appropriately navigate the ERC.
IRS Forms K-2 & K-3
These forms can require much effort and potentially apply to even smaller entities. Let’s discuss how these schedules apply to your situation and strategize to comply with this important requirement.
Digital Assets and Virtual Currency
The sale or exchange of virtual currencies, the use of such currencies to pay for goods or services or holding such currencies as an investment, generally have tax impacts – and the IRS continues to increase its scrutiny in this area. We can help you understand any tax and investment consequences.
Optimization Strategies for Business Transactions and Partnership Compliance
Navigating tax considerations in business transactions with owners, alongside comprehensive insights into partnership audit rules, can be tricky and get complex. Ensuring proactive planning to minimize potential repercussions for both entities and partners is essential and something we can assist you with.
Transactions Between Business and the Owners
Transactions between a business and its owners carry significant tax considerations. This includes aspects such as loans, distributions, and salaries. Our expertise lies in structuring these elements in a manner that is most beneficial from a tax perspective.
Partnership Audit and Adjustment Rules
Changes to the partnership audit and adjustment rules have been in effect for a few years but we are still seeing some partnerships and their partners blindsided at the unpleasant consequences that can arise from these rules. Careful planning today can help mitigate any unfavorable consequences to both the entity and the partners themselves. Also, be aware that even if your business isn’t a partnership, you’ll want to evaluate the effect these rules could have if you’ve invested in any partnership.
Preparing for Disasters
Do you have a disaster recovery plan in place for your business and, if so, have you updated it recently? We can help you review your plan, especially as it relates to financial information.