For more than 25 years, I’m proud to say my tax book for small businesses has been the go-to guide for owners and tax advisers. The 2025 edition for preparing 2024 returns as well as tax planning for 2025 has been updated to include law changes from earlier tax legislation (e.g., Inflation Reduction Act; SECURE Act 2.0) effective in 2024, as well as court decisions and IRS pronouncements.
As has been my practice with each edition, I’ve written my own book review to explain the purpose of the book, what’s new, and what’s ahead.
Why small business owners need this book
If you’re like the vast majority of small business owners (about 90%), you use a CPA or other tax pro to prepare your business returns. You may even work with tax experts on specific matters, such as inventory management, payroll, and succession planning. That’s great, but for small businesses, continually asking for advice on every matter that comes up, can be too pricey.
It’s my belief that whether you’re just starting out or have been running your business for a long time, all small business owners need to be informed about taxes and can’t rely solely on tax professionals. The reason: owners, not their accountants, software, or AI, run their businesses and make decisions impacted by taxes on a daily basis.
- What are the tax differences for entity types (e.g., S corporation versus LLC)?
- Should you hire employees or engage independent contractors?
- How much should you pay yourself and how to do it?
- Should you buy or lease equipment?
- Should you go green, which may entitle you to special tax deductions or credits?
- What type of financing should be used to start or grow a business?
- Who should own the truck—the owner or the company?
- What are the consequences of offering your employees a particular type of health care arrangement, or opting not to offer any medical coverage?
- Which is the best retirement plan for you and your staff?
- What are the tax implications of various other employee benefit plans and how do you offer them without messing up and incurring penalties?
- What are the tax and practical implications of operating a business from home?
- What happens if you operate in more than one state or have more than one business?
You may get information from your tax pro that’s helpful to your business. But you can also educate yourself by reading my book—without incurring professional fees. At a minimum, you’ll be able to ask your CPA or other tax adviser the right questions to protect your business and cut your tax bill.
Why tax professionals need this book
As a tax pro, I’m assuming you are aware of tax rules impacting clients that are small businesses and their owners. The book goes beyond tax rules to provide a holistic approach to various matters that will help tax advisers provide the best guidance for clients. For example, it’s one thing to understand the tax implications of debt versus equity financing, but it’s another to appreciate the practical implications of these choices of which clients should be made aware.
What the book includes
In addition to reflecting all cost-of-living adjustments to various limitations and eligibility requirements for tax breaks, the 2025 edition covers the tax changes from the from the Inflation Reduction Act of 2022 and SECURE Act 2.0 that became effective on January 1, 2024, which may impact your 2025 federal tax return. It also has changes from older legislation that became effective in 2024 which may not be favorable, such as the reduction in the percentage allowed for bonus depreciation and the Beneficial Ownership Information (BOI) reporting rule.
The book also includes:
- “Looking ahead” boxes to alert you to rule changes effective starting in 2025 or later so you can plan ahead.
- Special topics, such as multistate operations, sideline businesses, succession planning, and special considerations for the year in which a business starts or closes, are explained in basic terms.
- An explanation of Beneficial Ownership Information Reporting that owners of certain types of new or existing businesses must comply with to avoid serious penalties. Non-exempt businesses that existed before January 1, 2024, must file their information online with the Treasury’s Financial Crimes (FinCEN) Enforcement Network by the end of this year. While there have been calls to delay this requirement, Treasury Secretary Yellen has said “no.”
- Sample forms and schedules as well as various checklists. The sample forms and schedules aren’t intended for filing since nearly all taxpayers now e-file, and the necessary forms and schedules are part of your or your preparer’s software used for tax return preparation. But they give you an insight into the information you need to give your tax return preparer or have on hand for yourself in order to complete your tax return (e.g., a VIN number if you purchased a new or pre-owned EV from a dealer in 2024 and “sold” the credit to the dealer).
While the book primarily focuses on federal income taxes, it includes information on federal employment and excise taxes, as well as some state and local tax matters. It lists information returns that businesses may be required to file, plus when and where to do it. And it discusses how to deal with the tax professionals and the IRS.
What’s to come
The tax law doesn’t stand still. There are always new laws, cases, and rulings that arise after the publication of the book. A lame duck Congress may enact measures to impact 2024 returns, including restoration of 100% bonus depreciation, a reversion to the old reporting threshold for merchant reporting on Form 1099-K, and a restoration of expensing for research and experimentation costs.
Remember, in past years, there has been last-minute tax legislation (e.g., the Consolidated Appropriations Act, 2023, was signed into law on December 29, 2023). What’s more, with a new administration and a new Congress, there could be tax legislation early in 2025 impacting 2024 returns.
To update readers, there’s an online supplement to explain last-minute developments that could impact 2024 returns and tax planning for 2025 and beyond. The supplement is free and should be posted early February 2025 on my website as well as on JKLasser.com.
Interacting with readers
Each year I receive emails from readers asking questions, suggesting future topics to include, and sometimes pointing out errors. I’m very grateful for these communications, which helps me continually improve the book and provide valuable assistance to small business owners. If you have thoughts on the book, please email me at barbara@ BigIdeasForSmallBusiness [dot] com.
Mark your calendar
The final estimated tax payments are due:
- Calendar-year C corporations: December 16, 2024
- Owners of pass-through entities: January 15, 2025
Calendar-year partnerships, multi-member limited liability companies, and S corporations must file their 2024 federal income tax returns by March 15, 2025. Owners of pass-through entities as well as calendar year C corporations must file their 2024 income tax returns, as well as pay their first installment of estimated taxes for 2025, by April 15, 2025. There are extended due dates for victims of federal disasters.
Final thought
My book goes on sale on Amazon on December 5, 2024. But you can pre-order the book now.
