J.K. Lasser's Small Business Taxes 2023

CHAPTER 26Tax Strategies for Opening or Closing a Business

• Initial Tax Decisions to Make
• Investing Your Own Resources
• Debt versus Equity Financing
• Tax Identification Numbers
• Choose Your Accounting Solution
• Tax Reporting for the First Year
• How to Write Off Start‐Up Costs
• Setting Up a Business Bank Account and Credit Card
• Moving a Business
• Aborted Business Ventures
• Bankruptcy
• Winding Up a Small Business
• Tax Reporting in the Final Year

Alert

At the time this book was published, Congress was considering tax changes that could affect 2022 tax returns and planning for 2023. Check the online Supplement in February 2023 at www.jklasser.com or www.BigIdeasForSmallBusiness.com to see what changes have been enacted and when they become effective.

Two of the most challenging times of running a business are, perhaps, the start‐up and close‐down phases. Taxwise, there are certain opportunities that should not be overlooked.

For further information, see IRS Publication 583, Starting a Business and Keeping Records.

Initial Tax Decisions to Make

When you start a business of any kind, whether a full‐time or part‐time one, you need to make certain choices. Here is a checklist of the elections, choices, and decisions to make when commencing a business (the chapter in which the item is discussed is also noted):

• Type of entity (Chapter 1). Should you incorporate? Form an LLC?
• Tax year (Chapter 2). Should you use a calendar year? A fiscal year (and which fiscal year)?
• Accounting ...