Business tax planning is very complex. Careful planning involves more than just focusing on lowering taxes for the current and future years. How each potential tax saving opportunity affects the entire business must also be considered. In addition, planning for closely-held entities requires a delicate balance between planning for the business and planning for its owners.

Our recently published annual Tax Letter for Businesses includes a discussion of various tax incentives that have been enacted or extended during the year by the American Recovery and Reinvestment Act of 2009, enacted on February 17, 2009, and the Worker, Homeownership, and Business Assistance Act of 2009, enacted on November 6, 2009. For a more detailed discussion of the tax provisions of these Acts, please see BDO’s on Tax Stimulation and Federal Tax Alert on The Worker, Homeownership and Business Assistance Act of 2009.Alert

At this writing, Congress is considering additional tax legislation that would, if enacted, extend a number of provisions that would expire at the end of this year. Although Congress routinely extends such expiring provisions, the outcome of this proposed legislation cannot be predicted with certainty. Be aware that the tax planning ideas discussed are general in nature and are intended only as an overview. We suggest that you review your situation with an experienced Somerset tax professional before taking any action.