First, look at your current Profit and Loss statement and compare it to last year’s (prior year to date comparison). How are you doing? Are your income increases and resultant expenses in line? Why or why not? What do you think will occur in 2025?

Now that the election is behind us, we can make a rough assumption that the corporate tax rate will remain flat, so we need to rely on the profit to determine when we need to reduce income.

If you believe that the 2024 income will be higher (than 2025) – you can do the following to reduce it:

Look at making needed acquisitions in 2024:

Computer Hardware

Computer Software

Updating Office or Warehouse space

Automobiles ($12,400 depreciation without bonus, $20,400 with bonus). Remember to track the mileage.

Charity – Gifts made from C Corporations are taken on the business return. All other gifts pass through to the individual owner. Remember that the gift must be given to a qualified charity, not to an individual. Stale or obsolete inventory can also be donated. Call me to discuss.

Make year-end bonuses in 2024 – through payroll. Can issue a separate check to hand out.

Client gifts – limited to $25 each.

Employee parties are fully deductible (must be reasonable)

Is it time to purchase a building instead of renting? We have some unique offers from banks where they will pay some of your closing fees. Also, the SBA 7(a) loan rates have been lowered.

The QBI deduction, where 20% on your net business income needs to be considered when making the above calculations.

Last…

The final 2024 tax estimates are due on January 15, 2025. Take advantage of paying the State component through your business if a S-Corporation or a Partnership.

As always, we are here to help you.