Six Summertime Tax Tips

As you settle into the balmy days of summer, thoughts of tax time and April 15th are but a distant memory. Use this downtime to implement some solid tax strategies to help, not hinder, your summertime fun.

Death and taxes are the only two certainties in life. They're also two things people hate to think about. But if you're a business owner, taxes are a big part of your business. The smarter you are about using the tax code to your advantage, the more successful your enterprise will be.

There's another more pleasant certainty to add to the list: Some tax benefits align perfectly with the summertime months. Implementing them can have a positive effect once April 15th rolls around.

Hire the kids

If your children are on summer break, why not hire them? You can deduct their compensation from your bottom line. Besides giving your kids something productive to do during the summer months, it also allows them to take the standard deduction of $5,150 on their taxes.

Live it up…with clients and employees

Summertime usually means party time. There's no reason that you should leave clients out of the fun. If you throw a party and invite them, or take them on a business retreat, the expenses can be partially deductible. Whether you're hosting an employee party or charming a client, you'll encourage good will and hopefully increase sales.

Travel on the company's dime

If you need to take a business trip, try piggy-backing a vacation onto the excursion. Your airfare will be 100 percent deductible, as well as any expenses for hotel or car rentals that are used during the business part of the trip. Be reasonable about your deductions. You can't deduct a ticket to Disney World or other sightseeing costs; but pairing a business trip with a dose of pleasure can dramatically cut your costs.

Get cool by going green

Air conditioning is a necessity for most businesses. By installing a new, energy-efficient air conditioner, you can realize some significant tax benefits. For example, there are tax credits for up to 30 percent of the cost of new solar panels.

See your CPA

You may normally see your accountant only around April 15th, when he's feeling as stressed for time as you are. The summer months can be an ideal time for both of you to get together and discuss ways to revise your current tax strategies.

Summertime simply can't be beat when it comes to fun and leisure. But there's no reason why you can't dovetail some of the best parts of summer directly into your business. Take advantage of these tax benefits, but be careful not to abuse the opportunities. Work closely with your accountant to determine what's acceptable to the IRS, and then toe the line. In the end, your summertime and your bottom line will have a blissful coexistence.

By:Greg Mischi