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KSM Blog | Katz, Sapper & Miller CPA

Year-End Essentials for Veterinary Hospitals: Your 2019 Checklist

Posted 9:30 PM by

In the hustle and bustle of holiday activities, year-end business items can easily be forgotten. That’s why we’ve created a year-end checklist – to help you make the most of 2019 and keep your hospital as healthy as it can be.

Hospital Tax Planning:

  • Purchase equipment (new or used) and place it in service by Dec. 31 in order to fully write off the cost of the equipment in 2019.
  • Review the current fixed asset listing and remove any equipment that has been disposed or abandoned. This is particularly important if you reside in a state where equipment is subject to personal property tax.
  • As a reminder, there were significant changes to meals and entertainment deductibility in 2018 as a result of tax reform. If you haven’t already, consider separating meals and entertainment transactions into multiple accounts based on tax deductibility.
Meals & Entertainment
 Before Tax ReformAfter Tax Reform
Meals furnished to employees100% deductible50% deductible
Client business meals50% deductible50% deductible
Entertainment expenses for the benefit of employees (i.e., holiday party)100% deductible100% deductible
Entertainment expenses50% deductibleNon-deductible

 

  • Complete the year-end physical inventory count.
  • Review aged receivables and determine if any amounts should be written off.
  • Provide the following items to your payroll provider (if applicable) for inclusion on W-2 forms:
    • Personal use of company-owned automobiles
    • Shareholder health insurance premiums paid on behalf of a greater-than-two-percent owner of an S corporation
    • Disability insurance premiums paid on behalf of owners

Retirement Tax Planning:

  • Maximize your traditional and/or Roth IRA contributions.
    • The 2019 maximum for those under age 50 is $6,000.
    • The 2019 maximum for those over age 50 is $7,000.
      • Please note that there are income limitations related to Roth IRA contributions. Please contact your tax advisor with any questions. 
  • Maximize employee and/or spouse retirement plan deferrals.
Maximum Contributions
 Under Age 5050 and Above
Simple IRA$13,000$16,000
401(k)$19,000$25,000
 
  • Maximize Health Savings Account (HSA) deferrals.
Maximum Contributions
 Under Age 5555 and Above
Individual Coverage$3,500$4,500
Family Coverage$7,000$8,000
 

Individual Tax Planning:

  • Make contributions to your 529 college savings plan.
  • Consider making any charitable contributions by Dec. 31.
  • Submit for reimbursement any business expenses that were paid personally. These are no longer deductible on your personal return.
  • Discuss your tax projection with your CPA to understand the amount of tax payments that may be due in April.

Please be sure to contact your tax advisor to ensure you are maximizing opportunities and remaining compliant. Happy holidays!

About the Author
Terry O’Neil is the partner-in-charge of KSM's Veterinary Services Group. Terry helps veterinary hospitals grow by providing them business, financial, and tax advice. Connect with him on LinkedIn.


 

About the Author
Beth Scott is a director in KSM’s Veterinary Services Group. From financial statement analysis to key performance indicator reports, Beth works with clients to provide actionable solutions to their complex business challenges. Connect with her on LinkedIn.

 

About the Author
Ali Todd is a director in KSM’s Veterinary Services Group. Ali works closely with clients to understand their challenges and provide practical solutions, whether it is tax planning or creating an action plan for enhancing profits.

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