There were big changes in the tax code for 2013 and some of the provisions may come as a surprise to taxpayers. The national business services and accounting firm, 1800Accountants, recently released a free document, 4th Quarter Tax Strategies for Small Business, that outlines critical changes in the tax code, and includes practical tips on ways that small business owners can keep more of what they earned during 2013 by taking action now to maximize deductions.
“The time is now to take action on some key tax planning strategies that can help small business owners and self-employed individuals save big when tax returns are due on April 15. With three-quarters of the year behind you, chances are you have a good idea of how your profit (or loss) will look at the end of the year,” says Gary Milkwick, CPA and Vice President at 1800Accountant in a released statement.
Here are six key changes you should know about:
1. Taxpayers who itemize medical deductions can deduct less of their medical costs for 2013.
2. Buying a heavy truck or SUV (even a Mercedes SUV) can result in a big tax break that lets small businesses deduct almost the entire cost of the vehicle from their taxable income.
3. Small employers can deduct up to half of the cost of health insurance premiums paid for employees.
4. There’s a brand-new flat-rate deduction for home offices, which makes it easier to take the deduction with much less paperwork.
5. You can sandwich a vacation between business travel days and still deduct 100% of the transportation costs.
6. There are special tax rules for writers, artists, dancers, actors and other performers.