Taking advantage of employer tax benefits in your business
As a business owner in New Hampshire, make sure you're getting these employer tax benefits benefits:
1) Dependent Care Benefits—If you incur childcare expenses so that you can work, you should check to see if your employer has a dependent care program. If dependent care benefits are provided by your employer under a qualified plan, you may be able to exclude up to $5,000 of child care expenses from your wages.
2) Employer health care plans allow you to exclude the cost of insurance for you and your family from your wages.
3) If your NH employer has a 401(k) plan, you can elect to defer (pre-tax) a maximum of $17,500 for 2013. If you are 50 years or older, the maximum is increased to $23,000. These plans are especially beneficial when the employer provides a matching contribution.
3) Flexible Spending Accounts—Some employers provide flexible spending accounts, which allow an employee to make contributions on a pre-tax salary reduction basis to provide coverage for up to $2,500 of medical and dental expenses.
4) Tax-Free (income excludable) Employee Fringe Benefits—If the employer provides them, the law allows an exclusion from the employee’s taxable income for the following benefits:
(1) The cost of up to $50,000 of group-term life insurance.
(2) $245 (in 2013) per month for qualified parking.
(3) $245 (in 2013) per month for transit passes and commuter transportation.
(4) $20 per month for bicycle commuting expenses.
Are you getting all the tax free benefits you can out of your NH business? To learn more, check out Appletree Business Services' Business Financial Confidence Map.
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Copyright 2014 by Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, a PASBA member accountant, located in Londonderry, New Hampshire, with more than twenty- five years experience on Federal and New Hampshire issues affecting small business, and specializes in keeping his clients OnTrack with bookkeeping, tax, and payroll services for a fixed monthly fee. Learn more about Steve's exclusive SIX Step system developed for small businesses at www.appletreebusiness.com/map.