Changes in the Tax Code For Businesses in 2014

Changes in the Tax Code For Businesses in 2014The end of the year is always a time that business owners find themselves scrambling to make sure everything is in order. There are year-end bonuses to consider, new laws to plan for, and, of course, taxes to think about. 2013 was a big year for business owners when it came to tax considerations. One major change to the tax code for business owners is the implementation of the Affordable Care Act, also known as Obamacare.

A poll conducted by the Small Business and Entrepreneurship Council and as reported by Forbes found that 69 percent of small business owners said that the Affordable Care Act will make health insurance more expensive for them and their employees. “Even though Obamacare won’t go into effect until 2014 for individuals and 2015 for employers, it’s already costing small businesses regardless of the number of employees they have,” according to Forbes.

It’s not just Obamacare that will change the tax code for business owners, according to a different Forbes article. According to Forbes, there are “nine federal tax credits and tax deductions expiring on December 31, 2013.” Larger businesses or more successful entrepreneurs will be disproportionately affected by these tax changes. One such change is that the standard deduction of $500,000 will drop to $25,000 in 2014. Credits that expire include those for hired reservists, work opportunity, and research and development. Sales tax deductions also expire in 2013—if there are any big purchases your business needs to make, it’s a wise decision to do so before January 1.

According to Forbes other tax credits that expire that will affect business owners include:

  • “The accelerated deduction for qualified real property such as restaurants, retail, and leasehold improvements of $250,000 expires… In 2014 the deduction is zero.”
  • “Bonus depreciation of 50% expires 12/31/2013. In 2014, the bonus depreciation is zero.”
  • “Residential energy tax credits will expire… This 10% non-refundable tax credit caps out at $500.”

If you have questions about the tax code, or any other legal questions about your business, the most important first step is to seek the counsel of an attorney. Contact The Gierach Law Firm today.