Tax Time. Already?

?It’s the middle of October, so it’s also time to consider this year’s and next year’s taxes. Sorry!

If you pay estimated taxes, as many of us self-employed people do, you should have paid three of the four installments for this year already.

Last year I think I posted an article about Tax Code 179 which allows a profit-making business to deduct up to one million dollars in depreciable assets purchased in the current year. There are lots of rules and requirements and stuff, of course, so you should consult your CPA or other tax expert to make sure you do it right – if you can do it at all.

I think that Tax Code 179 covers vehicles, like SUVs and crossovers and trucks, with a gross vehicle weight of 6,000 pounds or more. So a big pickup or an Escalade might qualify. Probably several other vehicles, too, since everything keeps getting bigger. Ha!

But I’ve noticed that car lots are kind of bare right now due to supply shortages of computer chips and stuff. So any vehicle search should start now if you want to find what you want/need and to get it before the end of the year. And folks I’ve talked to who recently bought new or used vehicles tell me that prices are up and basically non-negotiable. They paid list price or more!

Another tax break I’ve heard about is the tax qualified exchange of like kind real property that allows profits to be deferred. Again, this is very technical, so consult your CPA before you start.

I’m no tax expert, but I read a lot about business and the effect of taxes on business. And I’ve been reading that tax code changes are being considered that might affect or eliminate Tax Code 179 and/or the 1301 exchange. So if these can benefit you, this might be the year to take advantage of them.

So, there has never been a better time to get real close to your CPA or tax expert. A lot of money can be at stake. And doing stuff wrong will either endanger the benefits – or even get you in trouble!