One of the most important things a small business must have to succeed is cash. In order to keep the most cash in your business’s pocket, take advantage of these ten small business tax credits:
1. General Business Credit
This is not just one credit, but rather a grouping of 25 different tax credits that get reported on IRS Form 3800.
2. Credit for Small Employer Health Insurance Premiums
This credit gives incentive to small businesses to provide health insurance to full-time employees. Although there are some strings attached. Click here to learn more.
3. Credit for Small Employer Pension Plan Startup Costs
Your business may qualify for a tax credit worth half of the cost of setting up and educating your employees on a retirement plan, up to $500.
4. Credit for Employer-Provided Childcare Facilities and Services
If you provide money towards your employee’s childcare costs, you can claim a credit worth up to 25%!
5. Disabled Access Credit
When you spend money to make your small business more accessible to the disabled you can claim a tax credit for half of your costs, up to $5,000!
6. Work Opportunity Credit
If you hire someone who the IRS considers having “consistently faced significant barriers to employment” you can claim a tax credit with a maximum of $9,600 depending on said employee’s earnings.
7. Credit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips
The FICA tip credit reimburses employers for a portion of the FICA taxes that were paid on employee’s tips.
8. New Qualified Plug-In Electric Drive Motor Vehicle Credit
If you are considering purchasing a new electric car for your small business, you may be able to claim a tax credit of up to $7,500.
9. Employee Retention Credit
This credit gives small business an incentive to keep all employees on payroll during poor economic times such as the COVID-19 pandemic.
10. Paid Sick Leave and Family Leave Credits
This tax credit can be used to offset costs of the Families First Coronavirus Response Act (FFCRA) which added time-off requirements for small and medium companies.
These tax credits may seem daunting, but you do not have to sort through them alone. Contact our team of experienced tax attorneys at 855-900-1040. We are happy to help you and answer any questions you have.
