Tax Credits To Reduce Business Taxes In 2019
Most companies understand that the
term,“tax credit” refers to something beneficial, but this doesn’t always
translate into them comprehending what it signifies. It can even lead to the
term being used interchangeably with tax deductions. This is incorrect because
as you will discover as you read through this list, tax credits are definitely
better than deductions.
Tax Credits
Tax credits are given to companies
and individuals to incentivize them to implement certain activities. Your
business must have bought or started using the equipment, facility, or vehicles
within the year for which you wish to claim the tax credit. All of the credits
are attached to related qualifications or limitations. It is important that you
understand what these are before submitting the claim.
Family Leave Act Tax Credits
2017 brought us the Tax Cuts and
Jobs Act. This includes a new form of tax credit meant to incentivize small
businesses into offering paid leave to all their employees. In order to receive
this tax credit, a business must activate a policy that gives a minimum of two
weeks of family leave on a full salary. There are stipulations as to which
employees will qualify for this. It must be in addition to sick leave (not
absenteeism), vacations, and holidays.
Going Green Tax Credits
Purchasing equipment to make your
business run more energy efficiently qualifies you for a tax credit. Anything
that can make your company run on a more environmentally-friendly basis
applies. In addition to these tax credits, your business may be eligible for
tax deductions as well. Any energy saving devices or activities such as wind
power, fuel cells, and solar panels qualify you for Business Energy Tax
Investment Credit.
Research And Development Tax
Credit
Any authority Research & Development Tax Credit
firm will
explain to you that even small businesses can qualify for this kind of tax credit.
Even if your firm doesn’t do traditional scientific or cutting edge research,
other forms of development can make you eligible for the tax credit. If you
have invested money into product development, business performance
improvements, product function, quality, and reliability improvements, or
payments to researchers outside of your company, then you can get a tax credit
for the amount spent.
Disabilities Access Tax
Credit
Paying for your business premises
to become more accessible for anyone with disabilities may qualify you for tax
credits. Anything that enables an employee or visitor more comfortable such as
barrier rails, toilet, and shower rails and smooth inclined ramps will serve
the dual purpose of making life better for the disabled individual and decrease
your tax for that year.
Hybrid Vehicle Tax Credit
If your company makes a move to
hybrid or alternative vehicle use, you will be eligible for Alternative Motor
Vehicle Tax Credit for that year.
Tax Credit is adapting all the
time to reflect changes in attitudes and priorities. Discuss any tax credit
queries you may have about your business with your tax professional near you. It’s
worth it when tax year comes around.
