Tax Savings Opportunities for Business

An interesting article in CFO Magazine reminds business owners of important tax savings opportunities. Find it here at http://www.cfo.com/article.cfm/12791024?f=alerts. You may also be interested in the comment posted to this article regarding 'like kind exchanges'.

I highly recommend making CFO Magazine.com a favorite. You can have articles automatically emailed to your inbox by setting up a profile and selecting topics of interest.

Email me if you would like more information about these or other tax saving opportunities that apply to your business at Gamspc@hotmail.com.

Happy and Healthy New Year to All!

Many internet websites are devoted to helping businesses succeed in a slow economy. Every situation is different, but here are a few ideas you may want to consider to realize increased sales and operating efficiencies:

• Create sales opportunities by adding a new service to your current offerings.
• Increase customer traffic by offering discounts or promotions.
• Ramp up customer service. Be extra attentive to existing customers, but court new ones, too.
• Review existing credit policies that is in line with your risk appetite.
• Advertise. If everyone else is cutting back on advertising and marketing, this is your chance to be more visible.
• Split advertising costs with neighboring, non-competitive businesses.
• Set up a blog to drive traffic to your Web site.
• Reduce your inventory to only what you need.
• Establish inventory reorder levels considering inventory turnover and delivery lead times.
• Hire an intern, who will work with you to earn college credit.
• Renegotiate a deal with a supplier.
• Cut back on overtime.
• Institute a hiring freeze or use more part-time workers. This will not only save money, but also help keep you from having to lay off employees.
• Trim the cost of benefits. Some decisions might be tough for employees, but it's better to scale back on benefits than to discontinue them entirely.
• Use free software through Google or other Web-based programs.
• Send reminder letters to your past-due accounts.
• Decrease postage costs by starting an e-newsletter.
• Turn down the thermostat in the winter.
• Turn off lights when you leave a room and shut down office equipment at night.
• When not in use, turn off electronics chargers, which draw power even when not charging.
• Have everyone bring in their own coffee mugs instead of going through hundreds of disposable cups each month.
• If your business requires travel, drive instead of fly. Or instead of renting a car while you're gone, take public transportation.
• Be honest with employees about how the economy is affecting your business.
• Offer low or no-cost rewards (like an afternoon off) to employees who come up with other cost-cutting measures you can implement.

Some businesses operating as limited liability companies (LLCs) may need a new employer identification number (EIN) for 2009. This new rule applies to your LLC if you have been paying and reporting your employment taxes under your own Taxpayer ID number (your social security number). In the past, the IRS has permitted LLC owners who report their business income on Schedule C of their personal return, Form 1040, to also handle their employment taxes under their own names and taxpayer ID numbers. Effective January 1, 2009, the IRS now requires that these LLCs to pay and report employment taxes using the name of the LLC and its associated EIN.

The new requirement pertains to employment taxes (FICA, FUTA and income tax withholding), not income taxes. If you have been reporting your LLC’s income and expenses on Schedule C of your Form 1040, you can continue to do so. Also, you don’t need a new EIN if you have been paying and reporting employment taxes under your LLC’s name all along.

If you need an EIN for your LLC, the quickest and easiest way to get one is to apply online at the IRS Internet website, http://www.irs.gov. Once the application is completed, the information is validated during the online session, and an EIN is issued immediately. Taxpayers can also quickly obtain an EIN by calling the IRS’s Business & Specialty Tax Line at (800) 829-4933. An IRS employee takes the information, assigns the EIN, and provides you with the number over the telephone.