Tag: Small Businesses

Important Tax Changes for Small Businesses

Posted on 29/01/2022

Tax laws have been constantly changing over the years. However, it is safe to say that it’s been over 30 years since there has been any significant change. Tax Changes Small business and Job Reforms Bill that recently passed is certain to impact everyone from individual taxpayers to business owners. In line with the previous sweeping tax reforms, this new tax act is likely to foster a great deal of business for accountants. The ideal way for accountants to take advantage of this potential boon is to demonstrate an intimate awareness of all the different ways the TCJA affects the majority of small businesses.

Important Tax Changes for Small Businesses

1. 20% Income deduction for most Small Businesses

Congress didn’t want small businesses to miss out on the party either, but they simply couldn’t lower the tax rate either. So, in order to give tax Changes Small business a tax cut, Congress brought around a new tax deduction; the 20% Qualified Business Income Deduction. If the taxable income is less than $157,500 (for individuals) or $315,000 (for married) taxpayers filing jointly, then the deductions are generally 20% of the net income of the business. If the taxable income is higher than these threshold amounts, then a deduction can still be availed but the limitations and exceptions will apply based on the occupation and wages.

2. 100% Bonus Depreciation

Depreciation is a tax deduction that facilitates the writing off of the gradual wear, tear, and obsolescence of certain properties. Depreciation rules can be complicated, with varying types and degrees of deprecation on different schedules. For instance, many types of properties take as much as 39 years to reap the benefits of depreciation. Fortunately, Congress introduced Bonus depreciation to speed up the process to muster tax savings faster. Then in 2015, Congress shot up the Bonus depreciation deduction to 50% in the first year. Now, the new tax reforms bill bumps the deduction all the way up to 100%. It is likely to stay this way until 2023.

3. Retroactive Refunds

One chief tax benefit for business owners is retroactive tax refunds. Having paid taxes in 2017, 2016, 2015 — or possibly even 2014 — can earn a 3-year review of tax returns for missed tax savings. And making a cut in the 93% of business owners who have paid too much in taxes, one can qualify for a retroactive tax refund. Fortunately, this law was not changed in the tax reform bill.

4. Mortgage Interest Deductions

Mortgage interest deductions will continue to exist. But only a few people will be claiming the deduction on their tax returns. Deductions can either be itemized individually or can take the Standard Deduction. Whichever method renders larger deduction is what would be considered for return. However, there was one key change to the mortgage interest deduction. The deductions have now been limited to new mortgages of $750,000 or less – down from $1 million in 2017. The mortgages originating before 2018 of $1 million or less are grandfathered in and keep their mortgage interest deduction.

Why VelanTax Changes Small business?

We at Velan are equipped with skilled tax preparers possessing over a minimum of 7 years of experience in the domain of Taxation CPA Services. Available round the clock at your disposal, we cater to services with the utmost sensitivity and sensibility that the work demands. With encomiums and testimonials speaking for themselves, one needn’t think twice before calling us. Our prices are highly competitive and guarantee international standards in terms of delivery. We cost less than an in-house tax preparer’s salary exclusive of his paid vacations, incentives, and bonuses.

Not only do we regularly keep updated with the latest tax laws, but support high-end infrastructure which allows us to function as a virtual extension of our client’s team, while ably providing our cost-friendly services.

If you have any queries related to your tax returns feel free to contact us for detailed information, we will be glad to assist you.

Call us today!!! And give your business the head start that it deserves!

Topics: Taxation


Outsourced Bookkeeping Services Basics for Small Businesses

Posted on 28/01/2022

One of the most significant benefits of Outsourced Bookkeeping Services is that you can radically scale your operations up or down without impacting the personnel directly employed by you. When it comes to running a business, a clear and detailed record of the history of transactions involved would be vital to the seamless and efficient functioning of the overall enterprise. It wouldn’t be an exaggeration to say that the survival of most businesses relies heavily on how these transactions are recorded and managed. Organizing these records can be done on paper, with the help of software, or by employing a hired hand. Without a proper bookkeeping system, a business can become vulnerable are susceptible to legal problems and cash flow issues.

Outsourced Bookkeeping Services Basics for Small Businesses

A smooth tax filing can only be asserted by a proper bookkeeping process. Business records are key ingredients without which sorting through the numbers would become messy and complex. Hence as an exercise of caution, it is important to keep the following information in the books:

Revenues and Expenses

Revenues, in general, refer to the money that the business receives from customers. This makes up the accounts receivables column in the book. Staying on top of the book would imply keeping it up to date and promptly sending out bills and invoices.

Keeping track of expenses is just as critical as keeping track of revenue.

In general, revenue and expenses constitute the most basic information in the book. Keeping a close check on them would prove to be highly critical.

Outsourced Bookkeeping Services for Inventory

Inventories are prone to merchandise misplacement, theft, and other mishaps. It is highly critical for businesses to maintain a clean and clear record of inventories to prevent the occurrence of such events. Keeping inventory holdings to a minimum would help in better tracking of sales and trends. The numbers in the inventory should be periodically tested by physically counting the products.

Outsourced Bookkeeping Services for Accounts Payable

The money that needs to go out to suppliers and the money that is due from customers come under the accounts payable column. Data that includes invoice dates, numbers, amounts, terms, dates and amount paid and/or due, client information, and balances needed to be organized and managed properly. A good bookkeeping practice, particularly Accounts Payable, can make payments easier.

Payroll Expenses

If there is one part of the book that needs to be up to date at any given time, this will be it. Besides being up to date, accuracy and precision is also highly critical. All this will come in handy during the tax filing season. Procrastination and sidelining of these activities can result in severe negative repercussions.

Purchases

Purchases are used to track materials of all sorts and kinds that are purchased for the business. It is an essential variable when it comes to calculating the profit of the company.

Velan Outsourced Bookkeeping Services:

We at Velan are equipped with skilled accountants possessing over a minimum of 7 years of experience in the domain of Outsourced Bookkeeping Services. Available round the clock at your disposal, we cater to services with the utmost sensitivity and sensibility that the work demands. With encomiums and testimonials speaking for themselves, one needn’t think twice before calling us. Our prices are highly competitive and guarantee international standards in terms of delivery. We cost less than an in-house accountant’s salary exclusive of his paid vacations, incentives, and bonuses. Some of the services we provide are listed below:

  1. Bank Reconciliation
  2. Statement of Assets and Liabilities
  3. Accounts Receivable and Payable
  4. P & L Statements
  5. Payroll Services
  6. Tax Preparation

Call us today!!! And give your business the head start that it deserves!

Topics: Bookkeeping Services