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5 Tax Saving Strategy Before the End of 2018

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Five last-minute strategies you can use to cut your 2018 tax bill

 

Strategy #1: Prepay expenses using the IRS safe harbor. IRS regulations contain a safe-harbor rule that allows cash-basis taxpayers to prepay and deduct qualifying expenses up to twelve months in advance without challenge, adjustment, or change by the IRS. Nice!

 Strategy #2: Stop billing your customers, clients, and patients. Not forever. Just until after December 31, 2018. Pushing taxable income into 2019 is an easy way to save money.

 Strategy #3: Buy your office equipment now. Since bonus depreciation is now at 100-percent, along with increased limits for Section 179 expensing, buy your equipment or machinery and place it into service before December 31. When you do, you'll get a deduction for 100-percent of the cost in 2018!

 Strategy #4: Start using your credit cards. If you're a single-member LLC or sole proprietor filing Schedule C for your business, the day you charge a purchase to your business or personal credit card is the day you deduct the expense. The punch line? Use your credit card for last minute business purchases.

 Strategy #5: Don't assume you're taking too many deductions. Remember. You should never stop documenting your deductions. Too many business owners, especially new owners, don't claim all their deductions when they could actually produce a valuable tax loss.

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