Oh, fuck. It’s the end of the year.
You should know I spent all day yesterday celebrating it by slurping blackberry margaritas while perched at a swim up pool bar (and sucking in my stomach for DEAR LIFE.)
That said, today’s Just The Tip is about money, BECAUSE WHEN IS IT NOT ABOUT MONEY?
Specifically because I’d like to save you some. <—Not actually trying to sound like a Geico commercial.
While I know you’re busy rockin’ around somebody’s large, artificial Christmas tree and opening people’s presents that aren’t yours (go for the box that looks like a Playstation!), there are two things you need to do STAT before December 31st in order to save yourself some money (and maybe a seizure come tax time):
1. Spend some money.
Unless you’re Mother Teresa and your business never incurs any expenses, chances are good you’ve probably got a few business-y things you were waiting until 2014 to splurge on–like that new Macbook Pro, for example, or that slinky new camera equipment (so you can finally shoot video without looking like your 5 year old niece was the director.) But think twice, grasshopper. (Mmmmm, mint.) Since most business owners typically benefit by minimizing taxes by lowering their reportable yearly profit, if you incur these types of expenses now, before the end of the year, then more business expenses = less reportable profit for this year—and less taxes come April. SWANKY.
2. Stop! In the name of
You’re probably trying to wrap up the end of the year all nice-and-neat with little bows and by badgering your clients to pay their 2013 invoices so you can start fresh for 2014, aren’t you, you little badgerer. BUT, if you did a poor job paying your quarterly estimated tax payments this year *swats ruler on desk* and you’re breaking out in a cold sweat imagining what you’re going to owe come April, then do yourself a favor and hold off on invoicing your clients until January, or give your customers a special “holiday” grace period–wink–so that revenue (and subsequent profit) doesn’t hit the books until next year. Again, less reportable profit = less taxes.
Note: Both of these assume you’re a typical small business operating on the standard calendar year and using a cash accounting system (where you count things as an expense at the time you pay for them, versus accrual accounting, when you count things as an expense when you order something–regardless of when payment is due–which is usually something fancy only companies with $5 million in revenue/year do.) Also good to note: S-Corps like us here at House of Moxie, Inc. / The Middle Finger Project go by a different fiscal calendar, so if you’ve bought the legal resource I co-created with an attorney to help you set up your business, and decided to go the S-Corp route to save on taxes in different ways, then you’re going to have to adjust your
Okay, I’m off to eat waffles.
At least it’s not another margarita?
In light of this ultra exciting information, what new things do you want to buy YOUR business for Christmas?