6 Best Tax Services to Consider for 2024
As taxpayers and employees, it is important to stay informed about changes in tax laws and regulations and the best tax services. The six important US tax services to keep in mind are the child tax credit, business interest deduction limitation, and research and experimental expenditures, bonus depreciation, small business asset expensing, employee retention credit (ERC).
6 Top Tax Accounting Outsourcing Services to Consider
1. Accounting Outsourcing Services - Child Tax Credit & its Benefits
Firstly, the child tax credit is a tax credit that provides financial assistance to families with children. The credit is worth up to $2,000 per child under the age of 17 out of which $1,800 is a refundable credit. To qualify, the child must be a dependent, a United States citizen/national/resident alien, and have a valid social security number. The credit begins to phase out for single filers with an adjusted gross income (AGI) of $200,000 or more and joint filers with an AGI of $400,000 or more.
2. US tax services - Business Interest Deduction Limitation
Business interest deduction limitation is a new rule that limits the amount of interest expense a business can deduct on its tax return. The limit is generally 30% of the business’s adjusted taxable income. This limitation does not apply to small businesses with an average annual gross receipt of $25 million or less for the three prior tax years.
3. Tax Online Services - Research and Experimental Expenditures
Research and experimental expenditures are costs associated with creating new products, processes, or software. These expenses can be deducted as business expenses and can result in significant tax savings. The deduction is available to both large and small businesses, and the amount of the deduction varies based on the size of the business and the amount of research and experimental expenditures incurred.
4. US Tax Services - Bonus Depreciation:
Bonus Depreciation is a US tax services incentive that allows businesses to immediately deduct a percentage of the cost of qualifying assets in the year they are placed in service. This provision is aimed at incentivizing business owners to invest in new equipment and machinery, which stimulates economic growth.
The Tax Cuts and Jobs Act (TCJA) of 2017 expanded the Bonus Depreciation from 50% to 100% for qualified property acquired between September 27, 2017, and December 31, 2022. And for the assets purchased between January 1, 2023 to December 31, 2023 the rate is 80%
5. Tax Online Services - Small Business Asset Expensing:
Small Business Asset Expensing, also known as Section 179 deduction, is a tax provision that allows small business owners to deduct the full purchase price of qualifying equipment or software in the year of purchase. The deduction limit for 2023 is $1,160,000, which means that businesses can write off the full cost of qualifying assets up to $1,160,000 instead of depreciating them over several years.
6. Accounting Outsourcing Services - Employee Retention Credit (ERC):
The Employee Retention Credit (ERC) is a refundable tax credit that was introduced as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help businesses retain their employees during the COVID-19 pandemic. The ERC provides a 50% tax credit on up to $10,000 in qualifying wages per employee per quarter.
It’s important to stay up-to-date on these accounting outsourcing services, as they can have a significant impact on your financial situation. By understanding the tax online services as child tax credit, business interest deduction limitation, and research and experimental expenditures, you can make informed decisions about your taxes.
On the other hand, Bonus Depreciation and Small Business Asset Expensing provide businesses with tax breaks for investing in equipment and machinery, while the Employee Retention Credit helps businesses retain their employees during challenging times. By staying informed about all US tax services related provisions, taxpayers and employees can take complete advantage of available tax incentives.
Remember to consult Xact Inc. tax experts for the best tax services or write to us at sunny@xact.inc, if you have any questions or concerns about filing your taxes or tax online services.
