Year-end tax planning tips involving fixed assets
November 14, 2011
As the end of the year rolls around, business owners should be looking into ways to reduce their tax liability.
As Justin Ransome of Granth Thornton's Washington National Tax Office notes in a recent SmartPros article, "It's not too late to change what goes on your tax return when tax season rolls around. Just a little bit of planning in November can often go a long way on April 15."
For example, the cost of eligible fixed assets
placed into service by December 31 can be fully deducted, provided the asset is new and has a useful life of 20 years or less under the modified accelerated cost recovery system.
Professionals considering giving property that has already undergone depreciation
to charity should reconsider. Instead, they should sell the fixed asset
and donate the proceeds. This allows them to take the capital loss in addition to a charitable deduction.
Ransome also recommends performing an annual financial checkup. Using fixed asset management
software such as Sage FAS offerings can expedite this process and make it less arduous.