How to Reduce Your Tax Burden When Operating a Business

December 22, 2022

As a business owner, you already have many financial responsibilities. Adding on the burden of taxes can be overwhelming. To reduce any stress, you need to find ways to reduce what you’re spending on taxes. 

Start a Retirement Plan 

Having a retirement plan in place can reduce taxes for you and your employees as well as your business as a whole. For example, you can offer 401k plans for their retirement. Since this counts as a benefit for your employees, all expenses related to these 401k plans can actually be deducted from your taxes. 

This includes matching contributions, management costs, and even paying a third-party consultant. You can save money on taxes via offering a retirement plan in many ways and it can even benefit you if you are the sole owner and worker in a business. 

Use The Right Structure 

There are four many types of business structures you can choose from when setting up your business and you can even change structures later on if you choose. If you want to save money on your taxes, then you need to make sure you choose the most advantageous structure. In a limited liability company (LLC), all members of the company are taxed as separate entities according to their tax brackets. 

If you favor a pass-through taxation structure, you could also choose an S-corporation structure. An S-corp allows you to only pay FICA taxes on your salary. An S-corp offers many other tax benefits as well as advantages for when you transfer or end the company. 

Save On Healthcare

Healthcare costs continue to rise and both you and your employees need ways to pay for any medical expenses. Offering a healthcare plan is one way to provide for this, but many businesses also offer an HSA (Health Savings Account). With an HSA, employees can save money in their account and this money will specifically be used for medical expenses. The benefit of an HSA is all contributions are made pre-tax and the account can grow and be withdrawn from tax-free. This gives you and your employees the money you need to cover medical expenses without needing to pay taxes on that money. 

Finding ways to reduce money going toward taxes can significantly benefit your business. With fewer expenditures, you have higher revenue and more of an opportunity to expand your business. It’s worth finding ways to reduce your tax expenses. 

Did you enjoy reading this article? Here’s more to read. WHY YOU SHOULD HIRE WORKERS FRESH OUT OF COLLEGE

Categories

More Posts:

Product Mistakes You Might Be Making at Your Business

Running a business isn’t easy, and making product-related mistakes can cost your company time and money. From creating products without doing market research to holding excess inventory or failing to file patents, there are numerous pitfalls that you need to be aware...

A Five-Step Guide to Starting a Logistics Company

If you've been considering launching a transportation and logistics company, now is the moment. The transportation and storage sector is very important and profitable. Statistics show that by 2027, the global logistics market would have grown from its 2017 valuation...

​​How to Prevent Lawsuits From Ruining Your Company

No one wants to deal with the hassle and expense of a lawsuit. Unfortunately, lawsuits can happen to any business, no matter how big or small. The best way to protect your company is to take preventative measures to make sure that you are doing everything possible to...

10 Strategies an Ecommerce Business Needs to Follow to Increase their Customer Base

Online retailers need to drive traffic to their websites to boost sales. It is important to choose the right marketing strategies to drive traffic since not every strategy will work for every business. This article provides an overview of efficient marketing...

Why Digital Menu Boards Are A Game Changer For Restaurants

There are numerous benefits of using digital menu boards in restaurants. The best drive-thru menu boards can be controlled remotely to make updating fast and easy. Convenience is the main focus of drive-thrus. Customers don't need to leave their automobiles to place...

How to Avoid Manufacturing Woes at Your Business

If your business relies on manufactured goods, then you know that there are a lot of potential problems that can occur during the production process. From defective products to missed deadlines, manufacturing woes can cause big headaches for your business.  Here are...

5 Strategies to Build Team Spirit in Your Business

The manner in which we connect and communicate with our staff members can have a considerable influence on their levels of motivation as well as their output. In this article, we explore a variety of psychological and motivational approaches that can inspire teams and...

What Your Business Needs to Make Remote Work Function Well

In the post-pandemic world, the necessity of remote work has become clear to more and more companies. It carries with it unique advantages as well as unique challenges for both employer and employee. Here’s what you need for it to work smoothly. Regular Communication...

How to Attract Executives to Your Company

If you’re trying to quickly expand your company, one of the most difficult steps will be finding experienced and talented executives. You’re going to need to work fast if you want to find the right people. Here are some of your primary tools for attracting the best...

Community Causes Your Business Can Donate to This Year

The best businesses find a way to give back to their communities when they find their own success. And if you want your business to make a good impression and improve its reputation, it helps to be involved in your community. You can do this in many ways, it is really...
How to Attract Executives to Your Company

How to Attract Executives to Your Company

If you’re trying to quickly expand your company, one of the most difficult steps will be finding experienced and talented executives. You’re going to need to work fast if you want to find the right people. Here are some of your primary tools for attracting the best...

All Categories

Business Operations

Entrepreneur Interviews

Marketing, Networking, & Social Media

Self Care & Personal Development

Working Moms

Business Software and Technology

Entrepreneurship & Small Business

Organizing Tips

Sales

Career Building

Family Businesses

Inspiration

Starting Your Own Business

Work-Life Balance

Communication

Hiring Help

Management & Leadership

Time Management & Priorities

Women in Leadership

Recent Posts

Soe Tun: The Copy Doctor

Soe Tun: The Copy Doctor

Autistic kid finds out that he’s unemployable and doesn’t enjoy most social settings. Decides to be a pro copywriter as a result.

Annie Anderson – Business Strategist & WordPress Creator

Annie Anderson – Business Strategist & WordPress Creator

Annie Anderson is the owner and digital creator at Midnight Rebel Digital Co. With over 25 years experience in design and development and more than 15 years experience with WordPress, Annie is a great person to have in your corner when it comes to websites, tech, and systems.

How Startups Can Ensure Health and Safety at the Workplace

How Startups Can Ensure Health and Safety at the Workplace

Everyone, including the owners, management, and staff, is responsible for ensuring workplace safety. All parties must take the proper steps so that no one is harmed while working. If you are looking for ways to keep your workplace safe, here are ten tips to help you out.

Product Mistakes You Might Be Making at Your Business

Product Mistakes You Might Be Making at Your Business

Running a business isn’t easy, and making product-related mistakes can cost your company time and money. From creating products without doing market research to holding excess inventory or failing to file patents, there are numerous pitfalls that you need to be aware...

Occupational Hazards That Come With an Office Job

Occupational Hazards That Come With an Office Job

Working in an office can be a great way to make a living, but it also comes with certain risks. Sitting at a desk for long hours and staring at screens can lead to physical ailments that not only cause discomfort but could eventually lead to more serious health...

How to Make Your Social Media Campaigns More Relevant

How to Make Your Social Media Campaigns More Relevant

Social media is a powerful tool for businesses of all sizes. It allows you to connect with customers and followers in a way that was never possible before. However, it's important to make sure your social media campaigns are relevant to your target audience. Here are...