
Lifestyle
Tips to Reduce Corporate Tax Liability
There are many things a business can do to reduce its corporate tax liability. During corporate tax preparation, businesses should monitor any changes in tax law that could affect their tax liability. By following the following tips, corporations can minimize their tax burden and keep more money in their pocket: 1. Make charitable donations through your corporation Many tax benefits are associated with donating to charity, so it’s a great way to give back while reducing your tax bill. Charitable donations have been proven to be a great way of giving back and lowering your taxable income. The limits on charitable deductions generally cannot exceed 60% or less than 20%, depending on the type you choose, though some exceptions apply, such as 30% 2. File S Corp taxes This allows you to file separately from the company, and you may take advantage of some tax benefits. There are many benefits to S corporation status, such as not paying taxes for business income. In addition, filing your own S Corp taxes means you can split up any losses with other shareholders and take advantage of either the individual or passthrough taxation options available. 3. Claim all business expenses When filing your corporate taxes, it’s important to remember that you can claim all business expenses as deductions.
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