While winter may be a bit of a down season for landscapers in terms of physical work but, that doesn't mean it has to be entirely unproductive. It's tax season which means you're probably working together with your office manager or your accountant to make sure your taxes are filed correctly. Regardless of who does your taxes, it is still a relatively painful process but, there are ways to alleviate some of the financial stress associated with filing. Listed below are some of our money-saving small business tips for landscapers that you can use this tax season.
Small Business Tips - How to Save Money this Tax Season
1. Be Wary of Equipment Write-Offs
These can truly be curses disguised as blessings if you are not careful (which is why it's the first of our small business tips). Many of you may know that you can write off the cost of the equipment you buy. While that may seem like an appealing way to lessen the burden of your taxes, it can be a crippling long term mistake. What the write-off actually does is it tells the IRS to defer your payment to a different year. You are not actually avoiding paying that tax. Whether you pay now or later is up to you (and there are advantages to either), just make sure to check with your accountant to develop a strategy.
2. Take Advantage of Deductions
Everyone has heard about the advantages of tax deductions but, surprisingly few use them. You can deduct a vast array of business expenses. You can also deduct some personal trips as well (so long as you spent half of your time there was spent on business-related activities). Of all of our small business tips, this one should be the easiest for you to take advantage of.
3. Identify Whether or Not You have to Pay Sales Tax
While many services are not taxable (such as labor) there exists a wide array of other services and products that may be subject to your states sales tax. It's a confusing subject and one that is too complex to cover in this blog. For that reason we strongly recommend that you meet with your accountant to ensure that all of your tax bases are covered. The positive part is that labor is a non-taxable service and, since labor makes up the majority of any landscaping business, there are ways for you to avoid paying too much in taxes.
We hope these small business tips for tax season help you and your landscaping business save some money this year. Just remember to be wary of equipment write-offs, take advantage of deductions and identify whether or not your business will have to pay sales tax.
If you have any further questions please feel free to contact us at 516-746-6322 or check out our business tax planning page. We look forward to hearing from you!