Newspaper article THE JOURNAL RECORD

Time for a Midyear Tax Checkup

Newspaper article THE JOURNAL RECORD

Time for a Midyear Tax Checkup

Article excerpt

NEW YORK (AP) -- Although 2000 is only half over and income tax returns aren't due until next spring, this is a good time to take stock of your business and see what you can do to lower your tax bill for this year.

Some of the decisions you make during the next few months can mean your company pays less to the government. But perhaps more important, they can also help your business grow and help you attract and retain good workers. Employee benefits are perhaps the first place you should examine when considering how to lower your taxes. They can give your business a tax deduction and will also make your company look more appealing to prospective employees, especially in a tight labor market. "In the current environment, you have to think, `What can I do to attract and retain people?'" said Mark Luscombe, a principal analyst at CCH Inc., a tax information publisher.

A variety of retirement plans are available, including the traditional defined benefit plan, which provides for set payments to employees after they stop working; defined contribution plans, with include the popular 401(k) plans; and several kinds of individual retirement accounts.

Employers can get a tax deduction for the amount of money they contribute to a plan. But it's important to keep in mind that different kinds of businesses get differing tax benefits under the Internal Revenue Code, and these variations will mean that one kind of retirement plan is more suitable for your business than another. So if you're trying to decide which plan will work for your company - - and which will be most attractive to employees -- you need to consult an accountant or human resources professional.

Health insurance is another benefit that can give you a sizable tax deduction and help your staffing situation, particularly since health care is such a big concern to employees. …

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