Begin year-end tax planning now

BY RICHARD D. BIENVENUE, CPA

This year’s Stimulus Bill provides businesses with several big-ticket tax saving opportunities. It’s not too late to take advantage of these opportunities, but planning needs to start now!

In addition to extending so-called bonus depreciation and increased limits for expensing capital purchases, retail, restaurant and certain other business are now allowed to recover the cost of qualified improvements over a 15-year period, instead of 40 years, through the end of 2009. In combination, these provisions provide a significant tax savings, especially if you are planning on expanding or renovating facilities.

If your business suffered a loss in 2008, take advantage of a stimulus bill provision that allows qualified small businesses to carry back net operating losses to offset profits of up to five years prior. File a claim for refund in 2009, after the 2008 return has been filed.

Other provisions could have significant impact under particular circumstances, including: Gain on sale of certain small business stock is excluded up to 75 percent through the end of 2010; the holding period for the so-called built-in gains tax for businesses converting to an S-corporation is shortened from 10 to seven years through the end of 2010; several new credits for businesses are available for benefit, particularly in the area of job creation and investment in alternative energy. ■


Richard D. Bienvenue, CPA, is a partner at Malloy, Lynch, Bienvenue, LLP, with offices in Brewster and Norwell. He can be reached at (508) 255-2240 or rich@mlbcpa.net.


Published in Cape & Plymouth Business September 2009