New tax laws has been enacted by Federal Government that’s why once you prepare all the documents for year-end planning make sure you are aware regarding to these changes. In addition, for business owners new requirements and tax credits will come out on this new tax laws.

Here are some things to consider while preparing year-end planning.

What changes could businesses to take advantage on this tax year?

 There was an Act enacted last March 18, 2010 to help profits and non-profits businesses to start hiring and investing through work force. Employers gain benefits on this Act because of hiring unemployed workers the said Act offers two new tax benefits like payroll tax forgiveness and income tax credit of $1,000 for making those qualified newly hire to regular.

This Act was called HIRE Act; this act can make extension to all expired provision last 2009 where businesses has the right to increase the amount they can expense under Section 179 for 2010.

What tax relief can provide by Small Business Jobs Act for 2011?

 This act was signed by President Obama last Sept. 27, 2010. This act allows businesses to claim expenses under Section 179 and capital expenditures in coming tax year 2010 or 20100. While small businesses permit to increase their expenses to $500,000 with a phase out of $2 Million.

To this act small businesses also permitted to decrease record keeping requirements of deduction taken by employer who provides mobile phones, and health insurance cost. From one to five years all small business tax credit that has carry back period will be extended. It also removes all capital gains to those who want to invest in small businesses.

What other changes might affect businesses for the year 2011?

Tax Increase that can happen:

•    Tax rate will increase from 33 to 39 percent and from 35 to 39 percent.
•    All eligible dividends will increase from 15 percent to a higher rate of 39.6 percent.
•    For long term capital gains its highest tax rate will increase from 15 up to 20 percent.
•    And, estate taxes will be back to its higher rate.

President Obama provides proposals like:

•    From Sept. 8, 2010 to 2011 companies are permitted to remove 100 percent of their new investment from plants and equipments.
•    Research credit will be expanded from 14 to 17 percent and can be permanent.
•    The middle class EGTRRA tax cuts (under $250,000 AGI) can be expanded permanently.