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6 small business tax breaks in current COVID relief law

January 23, 2021
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Small businesses are adapting their operations to make it through the COVID-19 pandemic. Some tax breaks in the relief bill enacted at the end of 2020 could help. (Photo by Norma Mortenson via Pexels)

Most COVID-19 relief focus has been on the added financial help to individuals.

That’s understandable. Millions of folks have been struggling to make ends meet as the pandemic has ravaged the economy. But they are facing fiscal woes in large part because their employers are in trouble, too.

When companies get their footing back, they can start to rehire laid off staff and things should pick up all around. That’s why recent coronavirus measures also have included help for firms, especially smaller businesses, beyond the love it/hate it Paycheck Protection Program (PPP).

Help for businesses dealing with COVID: There are several such provisions for struggling enterprises in the combination federal funding/COVID relief law that was enacted at the end of 2020. And Gene Marks looks at a half dozen of them in his recent article for The Philadelphia Inquirer.

As Marks notes, “taxes can eat up anywhere from 15% to 25% of a small-business owner’s income. Every dollar saved on federal taxes means more cash in your bank account, and that can mean surviving or failing these days.”

That’s why his article headlined The new stimulus bill has 6 big tax savings for small businesses earns this weekend’s Saturday Shout Out.

Per this feature’s guidelines, I’ll let you click on over to the City of Brotherly Love’s online newspaper site for the details. But here’s preview of what to expect.

The small business help includes tax credits, which are better than deductions because credits offer dollar-for-dollar offsets against your due taxes.

That said, don’t ignore the new law’s increased charitable deduction option for business donors. It’s good and good for your company soul and favorite nonprofit.

There’s even a way to defer for a bit and without penalty some tax business tax deposits you usually make, giving you a little cash flow room.

If you run your own small business, check out the article. It could help you hold on until the coronavirus is under better control and all your loyal customers can return.

You also might find these items of interest:

 

Coronavirus Caveat & More Information
In 2021, we all still are dealing with extraordinary circumstances,
both in our daily lives and when it comes to our taxes.
The COVID-19 pandemic and efforts to reduce its transmission
and protect ourselves and our families means that,
for the most part, we’re focusing on just getting through these trying days.

But life as we knew it before the coronavirus will return,
along with our mundane tax matters.
Here’s hoping that happens soon!
In the meantime, you can find more on the virus and its effects on our taxes
by clicking Coronavirus (COVID-19) and Taxes.

 

 

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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