Author: Greencrest

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The number of businesses for sale rose 4.7% in 2022 from 2021, according to BizBuySell’s Insight Report. This is still about 7% lower than pre-pandemic levels in 2019. However the median sale price dropped by about 3% in 2022, so what can you do to maximize your value, if you’re looking to sell? Increase Profitability […]

The number of businesses for sale rose 4.7% in 2022 from 2021, according to BizBuySell’s Insight Report. This is still about 7% lower than pre-pandemic levels in 2019. However the median sale price dropped by about 3% in 2022, so what can you do to maximize your value, if you’re looking to sell?

Increase Profitability

It’s time to look at those margins—Forbes urges business owners looking to sell to take an honest look at their company and see where they can reduce costs, without damaging the business before a sale.

This can be done in a variety of ways, including looking at business insurance and other contracts, to see where you might be able to reduce costs. Forbes also recommends looking at staffing levels. Could you make cuts? And, finally, work on only buying the inventory you need.

Know Your Assets

Some assets are obvious, while others you might forget to consider. Forbes recommends taking account of any physical assets you have—such as buildings, vehicles, office furniture and servers. You might be surprised at what has value! Your brand, procedures, along with any future revenue streams are all important assets.

Re-Examine Your Prices

Are your current prices reflective of your costs? If not, it might be time to raise your prices! ESOP Partners says you need to be careful about this one—you don’t want customers to leave! But even a small increase could help your margins significantly.

Have A+ Employees

What better way to look like a hot commodity than having great established employees. ESOP Partners says it’s important to keep a strong team on board; you can do that by offering opportunities for growth.

Money isn’t everything

When you’re looking at a business’ sale price, you’re talking about money. But the business value can mean so much more. The Business Transition Academy discusses in its book Cashing Out of Your Business the importance of having a quality and well-run business. Does the business need you to be successful? Are customers coming back year after year? Are you respected in your industry? It is crucial for a prospective buyer to easily see the value a business offers.

You may only get one chance to make an impression on a potential buyer; it’s important to maximize what your business can offer!

We are invested in your success. Contact us today and start maximizing the value of your business!

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For business owners, being aware of new business tax laws, legislation and obligations is crucial to planning for the year ahead and minimizing tax liabilities. Before meeting with your tax professional, read our guide that outlines key tax changes in 2023 that could impact your business. SECURE Act Updates That Affect Pension Plan Startup Costs […]

2023 Tax Updates All Business Need to Know

For business owners, being aware of new business tax laws, legislation and obligations is crucial to planning for the year ahead and minimizing tax liabilities.

Before meeting with your tax professional, read our guide that outlines key tax changes in 2023 that could impact your business.

SECURE Act Updates That Affect Pension Plan Startup Costs

The SECURE Act has nearly one hundred provisions that discuss retirement savings plans. One change is the increase in Section 45E credit for all or a portion of employer contributions to small employer pensions for the first five employer tax years, starting in 2023. The credit for employer contributions is capped at $1,000 per employee, and the new updates allow for credit to be available to employers with fifty or fewer employees and is phased out completely for employers with more than a hundred employees. Additionally, the existing tax credit for qualified plan start-up costs for employers with no more than fifty employees is increased from 50% to 100% of such costs, starting with the 2023 tax year. Learn more about new changes made under the SECURE 2.0 Act of 2022.

Certain Businesses May Receive Higher Federal Tax Bills

The 2022 Inflation Reduction Act (IRA) and removal of temporary provisions in the 2017 Tax Cuts and Jobs Act will mean that in 2023, the federal government is placing more financial responsibility on businesses. However, Section 179D significantly increases the energy-efficient commercial building deduction, making it especially useful for the architecture, engineering, and construction (AEC) industries as well as commercial building owners. Also, some states have provided state-level tax cuts to provide relief to this change. Find out if your state is one of them.

New 1099-K Form Rules Postponed for One Year

According to the American Rescue Plan Act of 2021 (ARPA), beginning in tax year 2022, small business owners and freelancers who received more than $600 from third-party digital platforms were scheduled to receive Form 1099-K and report that income. Platforms such as Amazon, Etsy and eBay were also obligated to report this income to the IRS. While a postponement was declared after much pushback from businesses, businesses that fall under the requirements will receive a Form 1099-K in 2024 for the 2023 tax year. See what the IRS has to say about these new income reporting rules.

Be Aware of the SALT Cap

The state and local SALT tax cap states that since 2020, filers can deduct only up to $10,000 in state and local property and income taxes. Business owners who operate a pass-through entity in a high-tax state may find their deductions limited by SALT rules. However, recently a group of House representatives relaunched the SALT causus for last week, calling for relief from the $10,00 limit on the federal deduction for state and local taxes. Learn more about the SALT Cap.

Additional 2023 Inflation Adjusted Items

Take note of these additional inflation-adjusted updates that could have implications on your business 2023 taxes.

These are just some of the tax updates taking place in 2023. If this seems overwhelming, then we have good news – we are here to help! Contact us today if you would like direct assistance in preparing for the tax year ahead and our experienced experts will provide you with personalized tax strategy that helps your business find opportunities that enable growth.