Page 53 - BusinessWest November 24, 2021

Accounting & Tax Planning
Year-end Tax Planning
Taking Steps Now Can Help Reduce Your Tax Bite Later
As the calendar turns to December, business owners and managers — and individuals as well — have a lot to think about. At or near the top of that that list should be an assessment of their tax outlook for 2021. By developing a comprehensive year-end plan, they can maximize the tax breaks currently on the books and avoid potential pitfalls.
WBy Kristina Drzal Houghton
hat a year it’s been. So far, we have had to cope with a global pandemic, extreme political division, and a series of natural disasters — just to mention a few noteworthy occurrences. These events have complicated tax planning for individuals and small-business owners.
What’s more, new legislation enacted over the last couple of years has had, and will continue to have, a significant impact. First, the Coronavirus, Aid, Relief and Economic Security (CARES) Act addressed numerous issues affected by the pan- demic. Following soon after, the Consolidated Appropriations Act (CAA) extended certain provisions and modified others. Finally, the American Rescue Plan Act (ARPA) opens up even more tax-saving opportunities in 2021.
And we still might not be done. New proposed legislation is currently being debated in Congress. If another new law is enacted before 2022, it may require you to revise your year-end tax-planning strategies. This article focuses primarily on techniques to reduce your 2021 taxes. However, if tax rates increase for 2022, as has been proposed, your strategy might be to accelerate income and defer deductions.
ACCOUNTING & TAX PLANNING
NOVEMBER 24, 2021 53
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