Year-End Business Tax Preparation

Here is a list of deductions to investigate 

Employees

• Employer tax credit through retirement plans 
• Employee-related federal tax credits, such as disability credits
• Year-end bonuses 
• Health coverage 
• Payroll and contactor payments – prepare W-2s and 1099-NECs 

Clients

• Consider postponing billing customers, clients, or patients until after December 31, 2024. This strategy, applicable to cash-basis accounting, can effectively reduce your taxable income for the current year.
• Review outstanding accounts receivables 
• Collection services or attorney fees are tax-deductible 

Equipment

• Do you need to repair, replace, or add to your existing equipment? A 60% bonus appreciation is still in place for 2024. It will reduce to 40% in 2025. 
• Using a business credit card can be advantageous when purchasing equipment for your business. You can deduct the expense from the date the charge appears on your card.
• Ask your CPA about bonus depreciation and EV tax credit for 2024.  

Building

• Prepaying 2025 rent by sending the check on December 31, 2024, so you can take the deduction for 2024 if you need it.  
• Energy efficiency tax credits: For example, adding solar panels or tint to your windows might qualify you for a tax credit.  
• If you are building energy-efficient structures for others, it can also give you federal credit. 

Operations

• Professional fees, such as tax accountant or legal services.  
• Marketing – 100% deductible, including AI 
• Rent 
• Research and Development (R&D) 
• Insurance 
• Travel expenses – set per diam rates 
• Meals – 50% deductible 
• Inventory 
• Interest expense 
• Charity contributions 
• Excess business loss limitations – keep track of your operating losses 
• Qualified Business Income (QBI) deductions