The end of the year is ideal for appraisers to schedule a meeting with their tax advisors and discuss ways to save money on 2016 tax bills … and to plan ahead for 2017.
Retirement savings and the costs of conducting business are some of the deductions available to entrepreneurs like appraisers. Here are a few examples:
- Contribute to or start a retirement plan: This has a double benefit of cutting taxable income now and helping save for the future. Retirement plans are especially valuable to appraisers who are self-employed and don’t have access to plans established by employers. Individuals can contribute up to $5,500 ($6,500 if age 50 or older) to a traditional or Roth IRA.
- Take business-related educational courses. Educational expenses are tax deductible if they are related to maintaining or improving skills for a current business or occupation. The Appraisal Institute offers a comprehensive catalog of advanced, qualifying and continuing education offerings, including webinars and classroom and online courses and seminars that provide a wealth of knowledge to both commercial and residential appraisers. Convention fees and related expenses also may be deductible. Plan ahead for next year by registering for the 2017 International Valuation Conference co-hosted by the Appraisal Institute and the Appraisal Institute of Canada, June 8-11 in Ottawa, Ontario.
- Start a business. There’s still time to take advantage of the tax breaks available for starting a business. Some startup costs may be written off before the business officially opens its doors, including employee training and wages, consultant fees, advertising and travel costs associated with finding suppliers, distributors and customers.
- Make business-related purchases. Before the end of the year, consider replacing old equipment, stocking up on business supplies, buying software or purchasing reference materials. All of these can potentially help appraisers maximize potential deductions.
Discuss these, and all other tax deductions, with a trusted tax advisor.