As we approach the end of the 3rd quarter we are only three months away from the end of another year. Too many businesses and individuals wait until the end of the year to start tax planning and others don’t plan at all. Many of the most effective tax planning ideas take time to implement. Some examples include:

• Setting up a retirement plan. Certain plans such as SIMPLE IRA’s need to be set up by October 1st.
• Building and equipment purchases. These are major capital investments and not only take time but must also be placed in service by the end of the year to qualify for a tax deduction.
• Sales of businesses or business assets. With the expectation that capital gain tax rates will increase in 2013 many businesses and individuals should look to liquidate capital assets at a lower tax rate.
• Health care and other tax credits. Many credits like the health care credit are based on number of employees, employee compensation and amount of benefits paid for employees. Businesses should review these credits well before year end to see if any changes have to be made to qualify.

Once the clock strikes 12 on January 1, 2013 the ability to save taxes for 2012 vanishes. It’s never too early to start tax planning!!