The small business world can be a daunting one at times, what with all the limitations imposed by a stubbornly stagnant economy. Add an ever-increasing tax burden into the mix, and you can see why so many budding entrepreneurs struggle to get off the ground. Fortunately, help is available for the struggling small business owner – a variety of tax credits can provide much-needed relief to those in the know. Consider easing the burden with one of the following small business tax credits:
Small Business Health Care Tax Credit
The Affordable Care Act (commonly referred to as Obamacare) is often berated by entrepreneurs due to the stipulations it places on businesses of all sizes. And while providing health coverage and maintaining compliance with government regulation can prove a major burden, there are policies in place to address some of these concerns.
If you employ fewer than 25 individuals and are unable to provide wages in excess of $50,000 a year, you may be eligible for the Small Business Health Care Tax Credit. Currently, this programs offers small businesses a maximum credit of 35 percent for health care premiums. However, employers should keep in mind that significant changes are set to take place at the beginning of 2014. At that time, the maximum credit will increase to 50, provided that participating employers pay for premiums offered through the designated Small Business Health Options Program Marketplace. While this may place a few restrictions on health care providers, most employers and employees agree that the 50 percent credit makes participation more than worth their while.
Section 179 Deductions and the Small Business Jobs Act of 2010
You know you can deduct a wide array of business expenses, but are you taking full advantage of this allowance? Recent policy changes may make it possible for you to write off all equipment and technology costs the year prior to filing. How is this possible? Enter Section 179, the tax provision known for its miracles of tax minimization. Thanks to a helpful provision included in the Small Business Jobs Act of 2010, you, as a small business owner, are allowed to write off up to $500,000 in business expenses. Such deduction allowances should make an otherwise steep tax burden far more bearable
Yes, the economic situation is dire for many a small business owner, and yes, taxes account for much of the financial burden on entrepreneurs. But all hope is not lost. Between tax credits for health care premiums and Section 179 deductions, you can keep those taxes to a minimum.