Small business owners can save on taxes

If you own a small business, every dollar matters - especially when it comes to taxes. Whether your business is a partnership or corporation, Uncle Sam offers some sizeable deductions to lower your liability, allowing you to put those dollars toward capital and employees.

Easy-to-use tax preparation solutions have become an increasingly popular way for small business owners to navigate deductions and tax law changes. The programs ask simple questions about business income and expenses to help maximize your deductions. Solutions, such as the value leader TaxACT, allow you to use their online solutions for free and only require payment when you're ready to file.

TaxACT spokesperson Jessi Dolmage shares three ways to reduce your small business taxes.

Tip 1: Buy to save

Whenever buying new equipment, technology, software or even furniture for your business, save those receipts and keep detailed records that include purchase price and date placed into service. You should be able to substantiate any expenses you claim on your tax return.

The 2013 Section 179 deduction limit for new and used assets purchased is $500,000. However, your business must be profitable in order to receive this benefit in 2013. In 2014, the dollar limit drops to $25,000 unless Congress extends this tax break.

Bonus depreciation of 50 percent of the cost of new items expires at the end of 2013. Depreciation can be claimed whether or not your business is profitable.

Tip 2: Tis always the season for giving

Company donations of money, supplies and property are all deductible expenses. So are bonuses (and associated payroll taxes) awarded to your employees, partners and officers. If your business is an S Corporation, keep a close eye on officer compensation to ensure you meet IRS requirements and thus avoid penalties.

Give yourself the gift of education. Take a class or seminar or attend a convention that helps you maintain or improve skills required for your business.

Tip 3: Business is sometimes personal

If you use your home for your business, you may be able to deduct mortgage interest, insurance, utilities, repairs and depreciation.

Corporations and partnerships can also deduct actual expenses for non-personal uses of your personal vehicle, as well as reimbursements to employees for business use of their personal vehicles. Actual expenses may include costs for fuel, maintenance and parking fees. Your detailed mileage records should include date, total miles, tolls, parking and purpose of trip. You can also deduct vehicle depreciation and loan interest.

The bottom line

Small business owners have year-round opportunities to cut their taxes. Dolmage recommends doing a dry run of your taxes with an online or download solution like TaxACT before you actually file to identify potential savings. Answer simple questions about your expenses and revenues, and the program will do the rest so you can see how moving revenue and expenses forward or back may change your taxes.

To make tax time easier, TaxACT also offers a free mobile app for organizing your tax documents throughout the year. Take a picture of receipts, statements and tax forms with TaxACT DocVault, then save up to 3 GB of digital images on TaxACT's secure servers. At tax time, import images into TaxACT to save with your 1040, 1065, 1120 or 1120S tax return.

Get more business tax tips at www.irs.gov and learn more about TaxACT Small Business solutions and TaxACT DocVault at www.taxact.com.

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Upcoming Tax Dates

July 1 Occupational excise taxes
File Form 11C to register and pay the annual tax if you are in the business of accepting wagers.

July 4 Everyone
Federal Holiday (Independence Day) - Details

July 10 Employees who work for tips
If you received $20 or more in tips during June, report them to your employer - Details

July 10 Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the first 15 days of June.

July 14 Regular method taxes
Deposit the tax for the last 15 days of June.

July 15 Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in June.

July 15 Nonpayroll withholding
If the monthly deposit rule applies, deposit the tax for payments in June.

July 27 Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the last 15 days of June.

July 29 Regular method taxes
Deposit the tax for the first 15 days of July.

July 31 Social security, Medicare, and withheld income tax
File Form 941 for the second quarter of 2015. Deposit or pay any undeposited tax under the accuracy of deposit rules.

July 31 Certain small employers
Deposit any undeposited tax if your tax liability is $2,500 or more for 2015 but less than $2,500 for the second quarter.

July 31 Federal unemployment tax
Deposit the tax owed through June if more than $500.

July 31 All employers
If you maintain an employee benefit plan, such as a pension, profitsharing, or stock bonus plan, file Form 5500 or 5500EZ for calendar year 2014. If you use a fiscal year as your plan year, file the form by the last day of the seventh month after the plan year ends.

July 31 Form 720 taxes
File Form 720 for the second quarter of 2015.

July 31 Wagering tax
File Form 730 and pay the tax on wagers accepted during June.

July 31 Heavy highway vehicle use tax
File Form 2290 and pay the tax for vehicles first used in June.

View More Tax Dates