Business year-end planning

Year-end planning for your business is more important than ever since change is likely. Be sure that your books and records are in good order so we can review planning opportunities.

Changes to Tax Breaks

  • Bonus Depreciation — Businesses have historically been able to deduct 50% of the adjusted basis of qualifying property in the first year the asset is placed into service, with any remaining basis subject to regular depreciation rules. Now businesses can plan to use it through 2019. However, the percent that can be deducted declines in 2018.
  • Section 179 — Small businesses can immediately write off up to $500,000 of tangible business property (computers, office furniture, etc.) placed in service during the tax year. Both the $500,000 expensing limit and the $2 million phase-out are indexed to inflation and expanded to include qualified real property. Also, businesses can now expense air conditioning and heating units placed in service after 2015.
  • Self-Employed (SE) Income Tax Rates:  
    • 12.4% Social Security tax on income up to $127,200
    • 2.9% Medicare tax — all SE income
    • 0.9% additional Medicare tax on earnings over $200,000 (single)