Whether you’re an LLC, S-corp, C-corp, or freelancer, a good tax strategy remains an essential piece in your business puzzle. With the arrival of tax season, you’ll want to retain as much of your hard-earned revenue as possible, and developing a custom tax strategy is the way.
At Summit Accounting Solutions, we’re your trusted partner in maximizing your bottom line. With our customized tax planning strategies, we assess your business’s finances and optimize your tax outcomes.
Discover how we help identify deductions, credits, and tax-saving opportunities for different business entities to reduce tax liability and support your bottom line.
Limited Liability Companies (LLCs)
LLCs are given flexibility in how they are taxed. You can choose to be taxed as a sole proprietorship or a corporation (S-Corp or C-Corp). Each choice has its own benefits that can help lower your overall taxes. This also includes a reduction in self-employment taxes, which can bring down the overall tax rate. We assist with filings for both multi-member and single-member entities.
Tax Strategy:
We help identify and apply deductions for expenses like business vehicle use, office supplies, and health insurance premiums. Choosing the right tax option can reduce taxable income and open the door to tax credits that can help save even more. As an LLC, you can also benefit from automatic limited liability protection.
S-Corporations
S-Corps pass income, deductions, and credits directly to shareholders, which helps them avoid double taxation. However, they have limits on the number of shareholders they can have as per the restrictions imposed by the IRS.
Tax Strategy:
We assist by implementing strategies like balancing salary and distributions to reduce payroll taxes. S-Corps can deduct health insurance premiums for shareholders who own more than 2% if it is reported as wages on their W-2. We can also help them claim home office deductions. Hiring family members and renting your home to the business for meetings are other ways to save more on your taxes. Moreover, contributions to retirement plans for both employees and owners offer further tax savings.
C-Corporations
C-Corps are taxed separately from their shareholders, which can lead to taxes being paid twice—once for corporate income tax on profits, and again for personal income tax on dividends. However, they allow more deductions and credits than other structures.
Tax Strategy:
We assist with managing retained earnings to keep taxes lower for shareholders. Salaries, charitable donations, and fringe benefits like health coverage and educational support can all be deducted to reduce the company’s taxable income. By balancing retained earnings with dividends, we help C-Corps benefit fully from available tax deductions.
Sole Proprietorships
Sole proprietors report business profits and expenses on personal tax returns, which are subject to self-employment taxes. This is because the owner and the company are one entity.
Tax Strategy:
We help you find deductions for travel, insurance, and office costs to reduce taxable income. Providing us with clear records and accounting tools will make it easier to track these expenses. The Qualified Business Income (QBI) deduction is another way to save money on taxes, and we assist in making sure these benefits are used correctly without causing compliance problems. We can help sole proprietors claim deductions of up to 20% of qualified business income.
Partner with Summit Accounting Solutions for a Tailored Tax Strategy
Don’t let tax season drain your profits. Summit Accounting Solutions is your trusted partner for expert bookkeeping services and custom financial planning services. Our tax strategies, including tax strategy consulting, are designed to help large and small businesses with comprehensive tax preparation to retain and grow their profits during tax season.
We can help you review your current business structure and make sure you’re getting all the tax deductions you’re entitled to, no matter the type of business entity. Contact us today for a personalized quote and expert accounting consulting services. At Summit Accounting Solutions, we make your tax savings our priority!
