Many businesses are unfamiliar with the numerous professional tax solutions that may help improve their budgets. Most potential savings are available through tax credits and strategies. However, without knowledge of these tax solutions, it becomes more challenging to effectively capture savings.

Learn more about how to optimize your tax strategy so you capture the maximum benefit. When your company is pursuing employment incentives, R&D credits or cost segregation savings, tax experts recommend the following techniques.

Employment incentives such as the Work Opportunity Tax Credit (WOTC) offer you increased tax savings when you hire employees who face barriers to employment.

On the first day of hire, have employees answer a survey that details whether they recently received food stamps, if they are a veteran, if they live in an Empowerment Zone or if they meet other requirements included on the survey that qualify your business for the WOTC.

2. Develop Structured Process to Capture Employee time Spent On R&D

If your business conducts research, you are most likely eligible to claim research and development credits. Supplies are one research expense you may submit for, but you should also ensure you are claiming the R&D credit for employee time.

You can accomplish by incorporating some acceptable methods such as using employee time sheets, interviewing employees and/or their supervisors periodically and capturing available source documentation. By taking the time to implement an effective process, you are able to prove that the research time you claim through the R&D credit is legitimate.

3. Conduct A Cost Segregation Analysis

A cost segregation analysis reduces your business’s tax liability by depreciating the value of real property. While it is necessary to work with an outsourced team to conduct this study, your company greatly benefits from increased cash flow.

4. Use Expert Tax Software

Project management tax software helps your company decrease costs by giving you control over outsourcing tax credits. Your tax consulting partner may have proprietary software that allows you to streamline the credit process as you manage each project.

5. Keep Important Documentation

Professional tax solutions such as employment credits, R&D credits and cost segregation studies help your business through reduced tax liability. However, you must be able to prove you are eligible for tax benefits in the event of an audit. Keep substantiating documentation in your files for the future so you don’t have to pay penalties if you are audited.

6. Research Tax Credits Available To Your Business

You may wish to read more blog articles and download free whitepapers that offer guidance on which tax credits your business qualifies for. When you learn more about professional tax solutions available to your company, you are more likely to capture tax benefits.

7. Consult Outsourced Tax Experts

While many companies choose to pursue tax credits on their own, you increase your total savings by partnering with an outsourced tax expert. Tax consultants are knowledgeable of often-overlooked areas within your business that may qualify you to further reduce your tax liability.

If you have questions about whether you qualify for tax benefits through employment incentives, R&D credits or cost segregation, speak with a tax expert today. The tax experts at CTI are able to guide you as you develop a tax strategy for your company.

Ready to learn more about effectively capturing R&D credits? Discover everything you need to know about research and development tax credits.