5 Tax Planning Strategies for Small Business Owners
If you run a business, you already know taxes don’t wait until the end of the year. They’re a constant part of your financial decisions—whether you’re buying equipment, hiring help, or setting aside funds for retirement. A solid tax strategy helps you keep more of what you earn while staying compliant with federal and state rules. And with the right planning, you won’t be stuck scrambling during tax season. This article covers five key strategies you can use year-round to reduce your tax liability, avoid penalties, and strengthen your financial footing as a small business owner. 1. Choosing the Right Business Structure Can Lower Your Tax Bill Your entity type directly affects how you’re taxed—and choosing the right structure can lead to significant savings. Many small businesses start as sole proprietorships or LLCs by default, but that setup might cost you more in self-employment taxes over time. If your business is consistently profitable, electing to be taxed as an S corporation ca...