Year-end Planning

Standard

There are only a couple of weeks left in the year and some things have to be done before the end of the month if you want to take advantage of them in 2013.

Accelerate Expenditures for 2013 deductions:
Purchase any office supplies, computers, equipment or other fixed assets before December 31st in order to accelerate the deduction for these business expenses into 2013. If you were planning on these kind of expenditures in the next couple of months, then now is the time to purchase to make the most of 2013 tax planning.

Make your Voluntary Retirement Contributions before year end:
Voluntary contributions to 401(k) plans or SIMPLE retirement plans have to be made before the end of the year. Employer matching can be made in 2014 for 2013, but the owner’s or employee’s voluntary contribution must be made before December 31st.

Delay Receipt of Customer Payments:
If you are a Cash basis taxpayer, delay receipt of customer payments until 2014 if possible. Many companies will write checks to their vendors toward the end of December in order to get the expense on their books for 2013. If you do not have “constructive receipt” of the payment in 2013, then you do not have to claim the revenue associated with this sale. Ask your vendors to send their payments at the end of the December or early in January to manage the cash basis income of your business.

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