Every new tax year brings the opportunity to optimize your financial strategy and keep more money in your pocket. But are you making the most of the tax credits and deductions you’re eligible for? Many businesses miss out simply because they struggle to track claims or aren’t aware of the full range of incentives available.
NetSuite changes that. With advanced reporting and automation, you can uncover missed opportunities and claim the full value of tax benefits.
Understanding Tax Incentives
If your business spending aligns with government priorities, the IRS rewards you with tax incentives. Initiatives like job creation and innovation can save you money on taxes. While both credits and deductions reduce your tax burden, they work differently in that tax credits directly lower the amount you owe. Deductions reduce your total taxable income. Either way, they save you money.
Are you investing in a new product line? Research and development (R&D) tax credits can offset up to 10% of qualifying expenses. Other common tax incentives include:
- Energy-efficient deductions: This covers business upgrades that reduce energy consumption.
- Hiring credits: This is designed to encourage job creation in underserved areas.
- Innovation credits: These reward investment in cutting-edge technologies or new products, that support innovation.
While they have their financial benefits, navigating deductions and credits can be complex. This is because some credits have industry-specific rules, while others may only be applicable in certain states. Justifying deductions also requires razor-sharp record-keeping. This can be tricky to produce without the right tools. You also risk missing out on credits or making mistakes that trigger audits. NetSuite helps to safeguard against this.
How NetSuite Maximizes Tax Incentives
NetSuite comes with built-in features to help you identify eligible deductions while keeping accurate records for tax compliance. Here’s how:
Identity-eligible incentives easily
The software’s customizable reporting ability simplifies the process of identifying tax incentives. Whether you’re focusing on R&D tax credits or energy-efficient upgrades, tailored reporting gives you access to a categorized chart of accounts making it easier to spot qualifying expenses.
Submit incentive claims with confidence
With accurate records, you have confident tax submissions. Because NetSuite is linked to your bank account and automatically updates your records in that way, you minimize the risk of errors when claiming tax kickbacks. It also offers built-in tax deadlines and threshold reminders to reduce penalty payments.
Handle audits with ease
NetSuite’s centralized record-keeping provides a clear audit trail to support your tax claims. All documentation stays organized and easily accessible, simplifying the audit process and giving you peace of mind.
Stay on Top of State and Federal benefits
Because NetSuite integrates financial data across jurisdictions, you can maximize state-specific deductions and thresholds if you operate a multi-state enterprise.
Best Practices for Utilizing NetSuite in Tax Planning
Consider the following tips to get the most out of NetSuite:
- Ensure Proper Setup: NetSuite integrates with various tools. Make sure that your setup is configured to track all transactions.
- Leverage Custom Reporting: Categorizing your transactions not only facilitates accurate oversight of your finances, it also makes it easier for you to identify eligible tax incentives.
- Centralize Documentation: Ensure all integrated tools store their records in NetSuite’s document management system to create a clear and accessible audit trail.
- Stay Current: Regularly update NetSuite configurations to reflect changes in tax laws or new incentives.
- Partner with a Professional: A NetSuite-certified accountant can help you fully optimize the software and ensure you don’t miss opportunities to maximize tax savings.
At Fusion CPA, our NetSuite-certified CPAs specialize in helping businesses across industries maximize tax credits and incentives. From setup and configuration to compliance and reporting, we ensure you unlock the full potential of NetSuite to streamline your tax planning and savings. Contact us for assistance today!
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This blog article is not intended to be the rendering of legal, accounting, tax advice, or other professional services. We base articles on current or proposed tax rules at the time of writing and do not update older posts for tax rule changes. We expressly disclaim all liability regarding actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.