(Akiit.com) Last week the nation, and indeed the world, reacted with scorn and ridicule when President Trump’s federal tax bill of $750 was shared with the world. Many were outraged to have spent more on their federal income tax than the billionaire head of state. But while this may certainly be a contentious issue among voters, it has gotten those of us who own businesses thinking a little harder about our taxes. After all, we want to ensure that we’re compliant. Not only is tax compliance its own reward, being found to actively evade taxes can be a huge PR black eye, not to mention extraordinarily costly. But we also need to consider how our tax obligations will impinge on our cash flow. An essential consideration for all businesses, especially in the current climate.
Fortunately, there’s a line to be walked between compliance and effective tax management. So that you can meet your state and federal tax obligations without compromising your cash flow (which may be a little precarious in the time of the pandemic). You want to pay your due, but you don’t want to join the legions of businesses that overpay on their taxes each and every year… 
Carry out a cost segregation study
You’re smart enough to claim your business deductions, and apply for tax credits where necessary. But you may be unaware how much you could save by carrying out a cost segregation study. A cost seg study will help to ease cash flow and prevent tax overpayment in these difficult times. Cost seg involves an in-depth study of your business’ assets, and the depreciating value of longer term or fixed assets. Painting a much more accurate picture of your assets for fair and appropriate taxation. A cost seg study takes a little time, but it can save your business thousands of dollars every year.
Plan ahead for major business changes
Whether you’re restructuring, merging, or acquiring another company, significant business changes can carry unexpected tax consequences. Planning ahead not only ensures compliance, but it also gives you the opportunity to optimise your position and potentially avoid costly pitfalls down the line. If you’re navigating this kind of transition, it’s worth reviewing Alpine Mar’s guide to M&A tax implications, which outlines the key considerations when handling taxes during mergers and acquisitions.
Invest your profits
Finally, it’s essential that you invest your profits back into your business as much as possible. This is tax advantageous (after all, you’re taxed on your profits, not your turnover). However, tax advantages are just the tip of the iceberg. Investing your profits into R&D, capital investments and the like can strengthen your competitive edge and improve your value proposition in the eyes of your clientele. And at a time when business has gotten more competitive than ever and consumers know that they can afford to be fickle, you can use every inch of a competitive lead you can get.
Staff Writer; Larry Adams