What’s the difference between big biz and your biz? A couple of things. Size, of course. Plus, big business almost always plans way in advance with the best tax advisors money can buy.
That’s why I decided to start my business with the emphasis on education. If you can hire a team of CPAs and tax attorneys at $500/hour+, then you don’t need this information.
I remember the day I was sitting in an all-day meeting for one of my clients. There were 2 CPAs and 4 tax attorneys. It was a full catered all day meeting for 8 hours. Our total billing was over $4,000 an hour. That meant $32,000, plus of course all the incidentals all the catered meals.
I realized that was the last time I wanted to be in a meeting like that. Sure, I made a lot of money, more money than I make now.
But it left all the small business owners and Mom & Pop landlords behind.
That’s why I write tax books. That’s why I do the group coaching. I want everyone who wants the tax breaks to know about them.
This past week, I looked at the top tax topics for my old world. This is what the big wealthy business owners are doing right now to pay less tax.
The good news is that you can take advantage of the same tax breaks. Strategies for businesses the same, big or small. But your circumstances will be different.
That’s why we have coaching and consultation, so you can find out what is best for you.
Get Credit for R&D
The R & D Tax Credit is getting big businesses five times what the PPP loan/grant gives them. There are no strings on how you spend the money. It doesn’t have to paid back. It is turning out to be a big success, and yet most small businesses aren’t taking advantage of it.
Defer Social Security Taxes
The Coronavirus Aid, Relief, and Economic Security (CARES) Act allows employers to defer paying their part of Social Security taxes through the end of 2020.
The first half of the deferred amount is due Dec. 31, 2021, and the remaining amount is due Dec. 31, 2022.
It’s a deferral, not forgiveness, so it’s just a delay in the payment. For businesses needing liquidity it can be a lifesaver and for others it could mean they get to invest the money in other ways to make more money. The government has to wait. They don’t.
Disaster Losses Create Refunds
The Trump Administration declared all 50 states were disaster areas in 2020. If your business was disrupted due to coronavirus you can claim a loss. In some circumstances, you can amend your 2019 tax return to take advantage of that loss and file for immediate refunds.
Quick Refunds from Current Losses
If your business has a net operating loss in 2020, the CARES Act allows businesses to use current losses against past income to claim refunds immediately. It allows a five-year carry back for net operating losses that arose in 2018, 2019, and 2020 for refunds against earlier returns.
If you don’t have a business, start one.
If you have one, the tax breaks are there for you.