Most likely you have not had your 2013 taxes prepared yet, and if you are preparing them yourself, you will want to know this. There were some pretty great small business tax incentives that were supposed to disappear into the sunset, or at least be reduced drastically, prior to the 2013 tax year. However, these three were extended to be included at their original value through the end of 2013, and some beyond, meaning you can use them on the tax forms you are currently getting ready to prepare.
Section 179 Expense
This is the rule that says you can fully expense certain costs for the year they were incurred rather than expense them out over the course of 5 years. Originally the cap on this was $500,000, and it was set to reduce over time until it reached $25,000 for the 2013 tax year. The $500,000 cap was extended through the end of 2013 however, and the $25,000 cap was extended to 2014. This could make a big difference on the 2013 tax return.
Another incentive that was set to blow away on the wind before the 2013 tax year is the bonus depreciation incentive that allows for up to 50%, and in some cases more, of certain investments to be taken as depreciation at once. This has now been extended to 2014 in some cases.
Those small businesses that have food inventory can donate it for a deduction that is twice what a charitable contribution would normally be. This incentive was to expire in 2011 but was instead extended to 2013.
What Does it Mean?
For some of these incentives, the tax return due April 15, 2014 is the last one that these can be used on. The extra depreciation and Section 179 expense would each reduce income if applicable, and thus reduce tax expense. The deduction for the charitable contribution of food inventory would also reduce the bottom line, meaning the 2013 return is the last time to save using these incentives. Be certain you are up to speed on what each once entails if you are doing your own tax return so that you do not miss out on any benefits for which your business may qualify.
However your taxes turn out this year, remember that Biz2Credit is here to help you with all of your financing needs in this year and into the future. Whether you need a traditional small business loan, equipment financing, a line of credit, or something else our professionals are here to hook you up with the perfect lender from our network of over 1,200. Visit Biz2Credit.com today for more information and to get started.