Tax cuts offer benefits for small business owners

As entrepreneurs looking to start a corporation prepare for the new year, it would benefit them to take a step back and review new tax regulations that could change their plans for the immediate future.

When President Barack Obama signed the much debated Small Business Jobs Act in September, he also introduced several new tax changes that will affect small business owners, especially those looking to make big purchases.

According to Entrepreneur magazine contributor Mark Henricks, the Act doubles the expense limitation to $500,000 for fully writing off fixed assets such as office furniture, machinery, equipment and computer software.

And this benefit is not something to be scoffed at.

“For instance, if a professional service corporation subject to a flat tax of 35 percent invested $500,000 in computers, software and office furniture, it could reduce its federal tax bill by 35 percent of that amount,” Henricks writes.

Employees stand to benefit from the tax provisions as well. CNN reports that the breaks could boost worker paychecks by nearly $40 per week.

Melissa Clark
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Melissa Clark

Head of Content & Customer Marketing at Incfile
Melissa sets the vision for Incfile's content marketing and customer relationship management. Melissa has more than 10 years experience in various marketing roles, and a passion for supporting small businesses as they incorporate and grow. She loves sharing information that will help business owners maximize their LLCs, Corporations and Nonprofits. In her spare time, Melissa is an active member of The Junior League and enjoys running half marathons.
Melissa Clark
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