Based on the new tax regime introduced by the government, 70 out of 100 deductions are being taken away in lieu of an easy tax structure. If you’re interested in this year’s income tax deductions and exceptions, as well as in the right merchant cash advance (MCA) for your business, you’re at the right place.
2020 Income Tax Deductions & Merchant Cash Advance
The Internal Revenue Service (IRS) has made the cap on 401(k) contributions $19.500 from $500. Below, you can find important information concerning taxes and changes for the year 2020:
- Life insurance is viewed as a personal expense, so there’re no tax deductions in this case.
- Self-employed people can’t deduct health insurance premiums.
- If you, a business owner, pay premiums for life insurance to protect your family, can’t be subject to tax deductions. If your life insurance policy is for protecting your business assets, the premiums will be tax deducted.
- If you’re running a Limited Liability Company (LLC), you’ll be taxed as a partnership or a sole proprietor. This year, you may qualify for income deductions.
- Being the owner of an S-corp, you can be an employee, paying yourself a salary. If this is your case and you also don’t ignore your self-employment taxes, the latter won’t refer to the remaining income you earn.
- Nonprofits are subject to special tax laws. If you own a nonprofit, no need to claim any tax deductions since no taxes will be imposed on your earnings.
Before going through other important points, remember that whenever you need access to additional funding for your business, just apply to a reputable alternative online lender in your field. With a true alternative lending expert, you can enjoy the most secure and cheapest financing options, including a merchant cash advance.
The Income Tax Deductions Still Included in the Updated Regime:
- Death-cum-retirement benefit
- Pension commutations
- Leave encashment on retirement
- Amount received on VRS up to Rs 5 lakh
- Employee Provident Fund money
- Funds received as a scholarship for education
- Cash received as awards in public interest
- Short-term withdrawals and maturity amount from the National Pension Scheme
This year has brought a new regime for tax deductions. To avoid headaches, go through the above-mentioned information concerning tax deductions and exceptions.
Author Bio: Michael Hollis is a Detroit native who now lives in Los Angeles. He is an account executive who has helped hundreds of business owners with their merchant cash advance solutions. He’s experimented with various occupations: computer programming, dog-training, scientificating… But his favorite job is the one he’s now doing full time — providing business funding for hard working business owners across the country.