Small-business Tax Guide

Small business tax filing
Although uncertainty continues to cloud the nation’s financial forecast, small businesses remain a powerful force in the U.S. economy. Bolstering their position are tax laws that present opportunities for reducing taxes, lowering expenses and encouraging investment in employees and equipment.

Select 2011 tax provisions - expense related
Your small business may receive immediate tax relief as a result of 2011 tax provisions, including Section 179 expense deduction and bonus depreciation, and gain additional capital by deducting start-up expenses for the tax year.

Employee-related
The FUTA tax, the worker retention credit and the small business health insurance credit may reduce your small-business tax liability for 2011. Furthermore, while small-business owners can no longer deduct health insurance when computing self-employment tax, they may subtract the cost from gross income to reduce tax liability.

Information reporting
;After 2011, merchants conducting credit card, debit card or gift card transactions will receive a Form 1099-K from the card processing company, which will also file a copy with the IRS. Along with new 1099 reporting requirements may come increased reporting penalties.

General
Claiming tax breaks without also planning for their impact on the Alternative Minimum Tax (AMT) may trigger a significantly larger tax bill. This tax season, understand the AMT, S Corporation built-in gains, net operating losses, and the importance of reporting foreign assets.