WHAT WILL NEXT YEAR’S
HARVEST LOOK LIKE?
T
hose who prosper in 2019 will have at
least one thing in common: they invested
time on key tax and business planning
strategies. One of the best ways to plan for
your future is to assess your past and present,
which is why this is the best time of year to
sit down with key advisors for a complete
business operations checkup. Together, you’ll
be able to formulate a plan designed to yield
substantial results in the year ahead.
WELCOME TO THE
PLANNING STAGE
The planning process usually begins with a
meeting between you and your CPA to go
over your specific tax situation. Oftentimes,
business owners will bring in other key
advisors as well. Depending on who’s present,
discussions can range from finances to
retirement plan design to succession concerns
and everything in between. You should also
work through specific business challenges
and concerns you may be grappling with.
2
Rise & Shine • Fall 2018
For example, maybe you’ve been considering
a large equipment purchase for a while, but
you’re still not sure if it makes sense right
now. Your tax advisor knows that the timing
of large purchases can make a big difference
on your overall tax impact, especially in
agriculture. So, during your meeting, your
team will consider all factors associated with
this large purchase and the impact it will have
on your bottom line in each scenario. After this
thorough assessment, your advisory team will
be in the position to make a recommendation.
Your end-of-the-year planning meeting is
an ideal time to discuss your revenue and
business goals. Believe it or not, a thoughtful
tax strategy can help you find success in the
year ahead. Taking the time to put together a
tax planning strategy is especially important
this year, since there is still some confusion
associated with the changes outlined in the
Tax Cuts and Jobs Act (TCJA).
You’ll also want to consider cost-saving
opportunities, such as dealer discounts
offered on equipment or input purchases. Will
your cash flow allow you to take advantage
of these opportunities and, if so, what
would be the tax impact of such a move?
Also, are you taking advantage of strategic
planning opportunities? For example, if you
are projecting a large tax liability based on
current results, you may be able to take steps
early on to defer or reduce your tax burden.
Ask yourself if you can:
•
•
•
•
Push some income into next year.
Make a large purchase or defer your tax
burden.
» Have you looked at bonus
depreciation?
» Can you take advantage of the
Section 179 deduction?
Accrue contribution for your retirement
plan.
Prepay operating inputs or other
expenses.