Spa Wise : Spending on Saving

On top of a hefty tax payment, spending extra money on tax planning may seem frivolous. But actually, the opposite is true when it comes to enlisting the help of a tax planner. Unlike tax preparers, who simply fill out the necessary forms to file your taxes, tax planners strategize and analyze your spa’s financials to minimize your tax bill. “Meeting now with a tax planner to develop a customized tax strategy can save you thousands of dollars in taxes,” says Larry Kopsa, a certified public accountant and partner at Kopsa Otte + Associates in York, NE. Here, Kopsa offers DS Minutes readers some of that professional advice for free.

Review your business classification. Have you established your business as a corporation or LLC? You may want to consider restructuring as your business grows and new laws are enacted.
Consider a remodel. The Economic Stimulus Act (see “Get in On the Act,” above) includes a provision that allows a tenant to write off 50% of leasehold improvements in 2008. Kopsa says the incentive is a great tax planning opportunity because standard tax laws dictate that such improvements are deductible over a 39-year period regardless of the term of the lease. He cautions, however, that the provision is temporary and leasehold improvements may go back to the 39-year schedule for 2009.

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Establish a Health Savings Account. If you have a high-deductible health insurance policy, you may qualify for a Health Savings Account (HSA). A tax planner can help you determine whether you meet four specific criteria to open an account. If you do qualify, an HSA works a lot like an IRA. “The concept is simple,” says Kopsa. “First, choose high-deductible health insurance to cut monthly premiums. Then establish deductible savings accounts for routine medical costs.”

For more information about Kopsa Otte + Associates, visit www.kopsaotte.com.