With the new tax laws and tax deductions evaporating into thin air, small businesses are struck with panic. However, G.B. Bajaj advises that businesses should not yet draw the curtains on all the options available to get a deduction. While it is true that certain opportunities have been taken away, there is still a good deal of smart planning considerations that can help businesses save a fortune. G.B. Bajaj shares some strategies to reinvigorate business owners who fear the intricacies of the new tax laws.
“There is so much discussion surrounding the new tax law that many business owners may be overlooking the old ones that still affect them today,” said G.B. Bajaj, Founder of Life on Thrive accounting firm headquartered in Long Beach, California. G.B. Bajaj is teaching a new workshop series titled “18 Tax Hacks Every Small Business Owner Should Utilize”.
The first good news is for businesses who would like to own automobiles. The new tax laws allow an increased deduction for a car as long as it is used for business. A business can enjoy up to an $18,000 deduction for any new car during the first year of purchase. Businesses that own a truck or an SUV can get a deduction for the vehicle.
It turns out there is a consideration for medical expenses too. Once itemized, more deductions can now be made for medical expenses. It also gets better as individuals can still enjoy deductions for both 2017 and 2018 medical expenses as long as they are more than 7.5 percent of the Adjusted Gross Income. However, come 2019, the threshold goes to 10 percent of the AGI.
Has your work caused you to move a long distance last year? Deductions can be applied to any expenses on moving if unreimbursed by the employer. Also, this deduction does not require the individual to itemize.
Car-service drivers such as Uber and Lyft can also have deductions based on mile count while driving a passenger and for miles driven between passengers. There are deductions for individuals that love to wager. If deductions are itemized, losses can be deducted up to the yearly winning amount.
So, there are still opportunities to save but the awareness of the available options is highly essential. Businesses can benefit from the advice of their tax advisor or use relevant sources such as to access information that would provide more information on tax deductions.