business - Linkenheimer LLP CPAs & Advisors

The Benefits of Operating Your Company with a “For Sale” Mindset

Selling your business may not be a current goal or something you plan to pursue in the future. However, it’s important not to dismiss the idea entirely, as running your company as if it were up for sale can bring numerous advantages. It is a strategic approach that emphasizes efficiency, organization, and value creation. By adopting this mindset, you can enhance your business operations, attract potential buyers, and maximize its long-term success. It also enables you to maintain excellent business records and address minor issues before they escalate into major problems.

Define Your Vision and Goals

Clearly articulate your long-term vision for the business and establish specific goals you want to achieve. Having a clear direction will help guide your decisions and actions.

Streamline Policies

Review and optimize your business processes to increase efficiency and eliminate any unnecessary steps or bottlenecks. Identify areas that can benefit from automation, technology, or outsourcing to improve productivity.

Imagine you’re in an elevator with a potential buyer, and you have a brief moment to describe your company. What would you say? Having a concise, easily understandable vision for your business is vital not only for appealing to outside buyers but also […]

By Linkenheimer LLP|2023-06-26T19:25:46+00:00June 26th, 2023|business|0 Comments

Traveling For Business This Summer? Here’s What You Can Deduct

If you and your employees are traveling for business this summer, there are a number of considerations to keep in mind. Under tax law, in order to claim deductions, you must meet certain requirements for out-of-town business travel within the United States. The rules apply if the business conducted reasonably requires an overnight stay.

Note: Under the Tax Cuts and Jobs Act, employees can’t deduct their unreimbursed travel expenses on their own tax returns through 2025. That’s because unreimbursed employee business expenses are “miscellaneous itemized deductions” that aren’t deductible through 2025.

However, self-employed individuals can continue to deduct business expenses, including away-from-home travel expenses.

Rules that come into play

The actual costs of travel (for example, plane fare and cabs to the airport) are deductible for out-of-town business trips. You’re also allowed to deduct the cost of meals and lodging. Your meals are deductible even if they’re not connected to a […]

By Linkenheimer LLP|2023-06-05T18:48:34+00:00June 5th, 2023|business, deduction, deductions, travel|0 Comments

Choosing an Entity for Your Business? How About an S Corporation?

If you’re starting a business with some partners and wondering what type of entity to form, an S corporation may be the most suitable form of business for your new venture. Here are some of the reasons why.

A big benefit of an S corporation over a partnership is that as S corporation shareholders, you won’t be personally liable for corporate debts. In order to receive this protection, it’s important that:

The corporation be adequately financed,
The existence of the corporation as a separate entity be maintained, and
Various formalities required by your state be observed (for example, filing articles of incorporation, adopting by-laws, electing a board of directors and holding organizational meetings).

Dealing with losses

If you expect that the business will incur losses in its early years, an S corporation is preferable to a C corporation from a tax standpoint. Shareholders in a C corporation generally get no tax benefit from such losses. In contrast, as S corporation shareholders, each of you can deduct your percentage share of losses on your personal tax return to the extent of your basis in the stock and in any loans you made to the entity. Losses that can’t […]

By Linkenheimer LLP|2023-03-27T17:16:20+00:00March 27th, 2023|business|0 Comments

Buying A New Business Vehicle? A Heavy SUV Is A Tax-Smart Choice

If you’re buying or replacing a vehicle that you’ll use in your business, be aware that a heavy SUV may provide a more generous tax break this year than you’d get from a smaller vehicle. The reason has to do with how smaller business cars are depreciated for tax purposes.

Depreciation rules

Business cars are subject to more restrictive tax depreciation rules than those that apply to other depreciable assets. Under the so-called “luxury auto” rules, depreciation deductions are artificially “capped.” Those caps also extend to the alternative deduction that a taxpayer can claim if it elects to use Section 179 expensing for all or part of the cost of a business car. (It allows you to write-off an asset in the year it’s placed in service.)

These rules include smaller trucks or vans built on truck chassis that are treated as cars. For most cars that are subject to the caps and that are first placed in service in calendar year 2023, the maximum depreciation and/or expensing deductions are:

$20,200 for the first tax year in its recovery period (2023 for calendar-year taxpayers);
$19,500 for the second tax year;
$11,700 for the third tax […]

By Linkenheimer LLP|2023-02-27T21:11:54+00:00February 27th, 2023|business, deduction, deductions, vehicles|0 Comments

Many Tax Limits Affecting Businesses Have Increased For 2023

An array of tax-related limits that affect businesses are indexed annually, and due to high inflation, many have increased more than usual for 2023. Here are some that may be important to you and your business.

Social Security tax

The amount of employees’ earnings that are subject to Social Security tax is capped for 2023 at $160,200 (up from $147,000 for 2022).

Deductions

Section 179 expensing:
- Limit: $1.16 million (up from $1.08 million)
- Phaseout: $2.89 million (up from $2.7 million)
Income-based phase-out for certain limits on the Sec. 199A qualified business income deduction begins at:
- Married filing jointly: $364,200 (up from $340,100)
- Other filers: $182,100 (up from $170,050)

Retirement plans

Employee contributions to 401(k) plans: $22,500 (up from $20,500)
Catch-up contributions to 401(k) plans: $7,500 (up from $6,500)
Employee contributions to SIMPLEs: $15,500 (up from $14,000)
Catch-up contributions to SIMPLEs: $3,500 (up from $3,000)
Combined employer/employee contributions to defined contribution plans (not including catch-ups): $66,000 (up from $61,000)
Maximum compensation used to determine contributions: $330,000 (up from $305,000)
Annual benefit for defined benefit plans: $265,000 (up from $245,000)
Compensation defining a highly compensated employee: $150,000 (up from $135,000)
Compensation defining a “key” employee: $215,000 (up from […]

By Linkenheimer LLP|2023-02-07T19:16:44+00:00February 7th, 2023|business, tax implications|0 Comments