The goal of tax planning is to pay as little to Uncle Sam as is legally possible. However, business owners should keep in mind that their actions to reduce taxes also affect the book value of their assets. For example, choosing to deduct the full cost of a new machine one year might save taxes, but capitalizing the expense over a longer period would add value to your balance sheet for accounting purposes. If other business requirements dictate minimum asset values (a condition of borrowing, perhaps), your best move might be to capitalize the expense, rather than take the immediate tax savings. Before taking any action, consider what is best for your business in the long-term, not simply what reduces this year’s taxes.
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Just started my first business a few months ago. Now it is tax season, and I have no idea what I am doing. I'll have to use some of your tips for small businesses, and see if they help me make the most out of filing my taxes. http://www.balkcom.com/services.html
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