As you may have heard, a special deduction designed to stimulate the U.S. manufacturing sector and various other industries - the domestic production activity deduction (DPAD) - was repealed after major tax legislation at the end of 2017.
The DPAD often ended up being a valuable deduction, equal to 9 percent of a company's qualified production activities income (including cost of goods, deductions, expenses and losses). That's why it's leaving a pretty big void for some businesses.
This may be especially true if you have a seasonal business relying heavily on holiday gift-shopping. While you may have gotten near-immediate tax benefits for producing goods at year-end in the past, that's no longer the case.
Other ways to saveNevertheless, there are other new tax law provisions that may be able to pick up some of the slack from losing the DPAD. Here are a few to consider:
Call if you have questions about implementing year-end strategies that optimize these tax benefits.
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