What Will the New Tax Policies Mean for Small Business Owners?
small business new tax policies

Many small business owners have questions, but the answers are not easy to obtain.

.

Let’s begin with ten key questions which best represent the most common questiona asked by small business owners regarding the new 2018 tax law:

  1. Will my company have a tax savings in 2018?
  2. Does it make a difference if I am an LLC or an S or C Corp?
  3. Do I have to revise my bookkeeping procedures?
  4. How long will the lower tax rates be effective for individuals and for businesses?
  5. How do I prepare cash flow projections for the next few years taking the intended changes into account?
  6. Will I be able to expense depreciable assets?
  7. Will health insurance be affordable for my employees?
  8. If I purchase inventory from outside of the U.S. will the costs of goods increase?
  9. Will my bookkeeping and accounting costs increase in 2018 as a result of the change in tax policies?
  10. Should I consider owning rather than leasing real estate? Will ownership be beneficial or detrimental to cash flow?

From my perspective as a financial consultant for small business owners there is only one certainty – confusion. 

Few professionals have the answers to these and many more questions. And no one professional has all the answers.

The information that has been provided to date is general information, relating to income groups; not individual entities. Each business will have to evaluate the benefits that relate to his or her financial condition. It may be several months before we have answers to the questions that concern individual entrepreneurs.

When small businesses are hampered by these monumental questions relating to their businesses, they retreat. They hold on to the status quo. They avoid expansion programs. They avoid further risks.

 This passive posture is antithetical to the nature of the entrepreneur.

Taking on debt

In my role of financial advisor to hundreds of clients, I am hesitant to position businesses to take on additional debt until there is a better understanding of how they will be impacted by the new tax policies. 

I intend to discuss the options with lenders, who also are currently in the dark.

Lenders are in the business of making loans, but they must evaluate their risks; which may increase or decrease, depending on the stability of the business, and how the tax changes will impact the operations and the net income; both pre-tax and after tax. I find myself reevaluating growth strategies for individual clients.

I intend to assist them in examining the risks and the opportunities, taking into consideration the uncertainties. 

Next page- Advice to Small Business Owners

RELATED POSTS

Employees Want To Be Valued, It’s Not Always About Money

Employees Want To Be Valued, It’s Not Always About Money

Key insights on what motivates employees beyond monetary awards Editor's note: this is part one of a two-part series. Setting up and operating a small business that financially supports the owner is itself an accomplishment. Building an operation that can support...

Organization Is Vital to Business Success

Organization Is Vital to Business Success

Today I no longer “jump in and try to figure it out as I go.” I prepare Organization has never been my forte. In fact, of all the qualities necessary to succeed when taking on risk, I believe this one is the most boring and uninspiring. To be totally honest, I am very...

How to Handle Emotions When Navigating a Toxic Work Environment

How to Handle Emotions When Navigating a Toxic Work Environment

To get back in charge try a simple exercise and then yourself  three questions When emotions run high due to experiencing a toxic environment at work, the best thing to do is to take a conscious and intentional pause. Pausing might seem passive and highly ineffective,...

Video Gallery

Polls

Sign Up for the Latin Biz Today Newsletter

PR Newswire

Featured Authors

avatar for Alex HartAlex Hart

Alexander J. Hart of Cuban American decen...

3 Action Steps to Financial Management

Money

Talent/HR

Legal

Marketing

Strategy

My Unusual Path to Launch a New Business

My Unusual Path to Launch a New Business

Understanding the value of stepping away from a large corporation to build my Hispanic business This is my entrepreneurial story. Like many Hispanic businesspeople Fortune 500 companies are great to work with until they interfere with your core values. That's the...

Fashion

Food

Music

Sports

Innovation

Work, Life & Culture

Culture

Health & Fitness

Travel & Destinations

Personal Blogs

Pin It on Pinterest