Written & Provided by Blue & Co., LLC
The end of 2024 is quickly approaching, and business owners are once again scrambling to put their companies in the best tax position and minimize tax surprises. The question we hear most often from our dental clients in the fourth quarter is, “How can I reduce my taxes and have enough cash to pay my taxes?” Here are some proactive tips to prepare for the 2025 tax season.
One: Maintain Records Using Accounting Software and Reconcile Your Bank and Credit Card Accounts
Your accounting software should prepare meaningful financial statements that allow you to make timely, necessary, and accurate business decisions for your practice.
Performing bank reconciliations ensures all transactions, including collections and expenses, which hit the bank and credit card accounts are included in the practice’s accounting software.
After you have completed the reconciliation process, review your financial statements within the accounting software for the following:
- Does revenue match collections in the dental software?
- Does cash on your balance sheet reconcile to your bank statement?
- Are all your loans and credit cards accounted for on your balance sheet?
Your accountant can assist with this process on a monthly or quarterly basis.
Two: Contribute to a Retirement Account
There is still time to contribute to a retirement account. While each practice owner has different goals for their practice and provides different benefits packages for their staff, a retirement plan can be a way for the practice to get a tax deduction and an opportunity for you and your employees to contribute to a retirement plan.
Your practice may be able to deduct retirement contributions in 2024, even if those contributions are not made until 2025, accelerating a tax deduction to the year before cash is paid to fund the retirement plan. There are a variety of plans available with various funding limitations.
Three: Purchase Equipment and Place In Service Before December 31st
If you know you need to replace equipment or you want to purchase new equipment to better serve your patients, time the purchase to maximize the potential tax benefits.
READ THE REST OF THE ARTICLE HERE- https://www.blueandco.
