Tax Optimization Strategies

Tax Optimization Strategies

WE KNOW THE SECRETS

OPTIMIZATION STRATEGIES TO

SAVE HUGE ON

BY JACKMAN PROFESSIONAL ACCOUNTING

SOME FACTS FOR YOUR TAXES

SIX billion! That is the number of hours Americans spend each year gathering financial information in order to file their taxes.

It's no surprise that the majority of business owners dislike dealing with their taxes.

Our tax system is "complex, unjust, clogged with gobbledygook and loopholes devised for those with the ability and influence to pay high-priced legal and tax consultants," as former President Ronald Reagan once stated. The good news is that you don't have to suffer from tax problems. You can negotiate this crucial component of running a business—and eventually, even make the tax code work in your favor—if you have the correct tax strategies in place.

This eBook will teach you how to lower your taxes using easy strategies.

Now for the good NEWS…

We have hundreds of tax strategies we'd like you to apply this year.

SA VI NG

Key areas for optimising and saving taxes

TA XES

01

Legal Entity Optimization

Legal entities are the various structures under which you may create a corporation: from S corporations and C corporations to limited liability companies, sole proprietorships, trusts, nonprofits and so on.

Sometimes, the entity election that worked for your business in the beginning may not be the best choice as your business grows.

Whether you have a C corporation, S corporation, partnership, LLC or even a sole prop, there’s a chance you can see significant tax savings by switching to a different entity type.

Our firm specializes in entity optimization to save business owners like you.

02

S-Corp Vs. C-Corp

For legal purposes, S corporations and C corporations are the same.

But did you know that tax planning for C corporations looks quite different than tax planning for S corporations?

Most business owners have no idea about the tax implications of their entity selection.

Tax benefits of converting from a C-Corp to an S-Corp The main advantage of converting a C-Corp to an S-Corp is that owners avoid double taxation of income. This can result in significant savings depending on the earnings of the corporation and the tax brackets of its shareholders. Tax benefits of converting from a S-Corp to an C-Corp The main advantage of converting an S-Corp and a C-Corp is that a C-Corp face the possibility of double taxation if corporate income is distributed to business owners as dividends, which are considered personal taxable income.

03

Environmentally Friendly Tax Credits

As green energy initiatives become more popular, you might be looking for ways to reduce your environmental footprint.

But did you know that environmentally friendly behavior can come with tax advantages?

In fact, congress recently authorized a handful of tax credits to incentivize you to make some changes to your home and vehicle.

Are you taking advantage of these?

We specialize in helping people like yourself save money on taxes in a variety of ways.

04

Refundable Tax Credits

There are two main types of tax credits: refundable and nonrefundable.

Each of these gives you the chance to lower your taxes this year.

But keep in mind, tax credits are different from deductions.

A simple way to think about it is that a tax deduction is a reduction of your taxable income, while a tax credit is a reduction in tax liability that’s applied after your taxes are tallied.

Here are some common refundable tax credits to be aware of:

American opportunity tax credit — if you paid qualified higher education expenses Child tax credit — if you have a family with qualifying children under age 17 Earned income tax credit — if you’re under a certain threshold of earned income Premium tax credit — if you’ve purchased qualifying health insurance The above credits are just the basics. There are actually many more tax credits you could possibly take advantage of this year.

Don’t want you to overpay the IRS? Get a tax plan for your business.

05

Hire Your Kid (not joking)

If you have a child (or multiple children), listen up.

Hiring your kids is a legitimate tax saving strategy.

If you hire your kids to do real work for your business, you could lower your business income, your self-employment income and your effective income tax rate… all while avoiding the kiddie tax.

However, to successfully shift business income from your own tax bracket into your child’s tax bracket, you must follow a few key requirements.

We can help you with that, plus arm you with many more potential tax saving opportunities.

06

Tax-Efficient Retirement Planning

If you have a business, what is the most tax efficient retirement plan?

You might even be asking: How do I even begin selecting the right plan?

There are so many plans to choose from…

SIMPLE plans SEP IRAs Pensions ESOPs

Stock bonus plans Profit-sharing plans Executive bonus plans

So, which is best?

The answer depends on your business and goals, but some plans are better simply based on the size of your business. We can help you in selecting the best retirement plan for your business? It could save you money on taxes!

07

Education Tax Credits

Education is expensive, but there are a few tax planning strategies you can use to save money.

We can discuss some options:

Roth IRA for education UGMA accounts UTMA accounts Education savings accounts, such as 529 plans or Coverdell ESAs Other methods of defraying costs, such as the American Opportunity Tax Credit, the Lifetime Learning Credit or student loan interest deductions

Regardless, don’t leave money on the table by overpaying the IRS.

If you have any education expenses, you deserve to legally reduce your taxes.

08

Real Estate Tax Strategies

You’re invested in real estate, right?

Did you know there’s something called Qualified Opportunity Zones (QOZs), which are various regions across the country that are considered economically distressed? Investors who realize capital gains from selling another investment can defer or even eliminate a portion of their taxable gain if they direct those gains into a QOZ. So, the QOZ tax benefits are clear, but there are plenty of other ways to save on taxes in the upcoming years.

Capital gains are likely to continue to increase!

Now’s the time to prepare.

09

Meals Deduction

Here’s an update on the 2022 business meal deduction:

Business owners can deduct 100% of business-related meal expenses when purchased from a restaurant.

The term “restaurant” is a business that sells food for immediate consumption, even if the food is not immediately consumed.

This means you can purchase food to-go from a restaurant and serve it at the office. This also means that grocery stores, specialty food stores, liquor stores, convenience stores and vending machines that sell prepackaged food do not qualify.

However, if food is purchased from one of these non-restaurant establishments, you can still take a deduction for 50% of the costs.

And, as with all ordinary and necessary business expenses, the meal expenses cannot be lavish or extravagant to qualify for the deduction.

Keep in mind that in 2023, the business meal deduction will revert to pre- 2017 rules, making meals once again more difficult to deduct.

In addition to business meal deductions, there are many new tax credits you might qualify for this year.

10

Vacation Tax Deductibles

In short, vacation costs are not deductible.

They’re not deductible for an individual, and they’re not deductible for a business.

However, this does not mean that travel expenses are nondeductible.

If you travel for work, you can deduct those costs as a legitimate business expense. Just be careful about when your work trip has elements of pleasure in it.

If a personal vacation is simply masquerading as a work trip, you will likely lose the ability to deduct it.

But there are things we can do to help you get the full travel deduction.

11

R&D Tax Credits

What is the R&D tax credit, and who can claim it?

Originally, the R&D credit (which stands for “research and development”) was created to reward taxpayers in industries such as pharmaceuticals, biotechnology, aerospace and software, just to name a few.

But get this:

Today, thanks to a few tweaks to the law, the R&D credit is broad enough to benefit almost any industry! Could you get a big tax credit through R&D? Yes, you can, chat with us to get maximum benefit of the R&D tax credits.

12

Top 9 Tax Deductions for Sole Props

Are you a sole proprietor?

There are nine tax deductions that we want to share with you this year. That could save you a lot of money and prevent you from overpaying the IRS.

1. Self-Employment Tax Deduction 2. Home Office Deduction 3. Internet and Phone Bills Deduction 4. Health Insurance Premiums Deduction 5. Business Insurance Deduction 6. Travel Deduction 7. Vehicle Use Deduction 8. Interest Deduction 9. Startup Costs Deduction

13

The Hidden Tax

Do you know what the biggest tax is?

Here’s a hint. It’s called the “hidden tax.”

So, what is it?

The hidden tax is inflation!

Tax brackets don’t adjust for changes in your purchasing power, so inflation could be causing you a tax increase this year.

It’s what tax experts call “bracket creep.”

If you think items such as energy, shelter, food and cars are getting more expensive, wait until you see how much your tax bill is going to be.

But the good news is we might be able to reduce it through careful tax planning.

#

Don't Let Your Tax Credit Expire

Every year, the IRS allows people like yourself to take certain tax credits.

The thing is, they expire… because if you don’t use them, you lose them!

Of course, you’re probably already doing some things to lower your taxable income, such as using your 401(k), contributing to your IRA, selling certain stocks that weigh down your portfolio and establishing a 529 plan or an HSA… But the tax code is LARGE, and while these are a good place to start, We're afraid you still might be overpaying the IRS this upcoming year.

Let’s lower your taxable income further and reduce your tax liability.

Remember, if you don’t find available deductions or credits you qualify for, you lose them!

#

Your Estimated Tax Payments

We're sure you’re aware that accurate estimates can help you avoid a large tax bill at the end of the year, but here’s something to consider:

Estimated taxes are not just about reflecting on the past.

Rather, they should serve as a proactive tax planning tool that helps you look into the future, shaping your business practices and prompting you to build a strategy to reach your goals.

Of course, estimating tax liability on income you haven’t yet earned can be tricky.

But we can help ensure your estimated taxes are as accurate as possible.

SA VI NG

Tax Resolution

TA XES

01

Have you been contacted by the IRS?

If so, it’s usually for one of these reasons:

They want to correct a math error on your return They need to tell you about a duplicate or missing payment They have to request missing information 1. 2. 3.

However, some notices indicate a more serious problem.

Some IRS notices will demand payment from an overdue tax bill. Other times, it will be about your refund being withheld due to a discrepancy or — for the unlucky few — an impending audit.

If you have received any mail by IRS. In that case, our firm can assist you. Over 1000+ businesses have already benefited from our assistance.

02

The IRS is expanding, it's time to ACT The IRS is getting an increased budget, which will lead to more enforcement and tax collection. What this could mean is higher chances of well-meaning people like yourself being possibly audited or penalized for tax mistakes. For example, if you ask yourself questions such as “Am I taking the right deduction here?” or “Does this tax credit really apply to me?” then we need to talk. We don’t want you making any mistakes, but more importantly, We want to save your money on taxes by taking advantage of all the legal tax credits out there that apply to you.

Get a tax strategy call today. And see how much you can save on taxes.

JACKMAN PROFESSIONAL ACCOUNTING & FINANCIAL SERVICES

Get Ahead Of The Game

Our Services: TAX PLANNING

Contact us today:

TAX RESOLUTION TAX FILING CRYPTO TAX ADVISORY

(603) 236-2594 jackmanprofaccount.com

Thank You! for reading this eBook. We hope you found it interesting.