Pub. 1 2013 Issue 3

Win ter Issue 2013 29 EXPERIENCE... Over 25 years of trusted insurance solutions. DETAILED ANALYTICS... Methodical approach to the bottom line. TOTAL CLARITY... Employee benefits made easy. WELLNESS... Progressive programs designed to promote healthy lifestyles. INNOVATIONS... Business solution to reduce healthcare cost. RESULTS... Proven track record time and time again. 23716 Birtcher Drive Lake Forest, CA 92630 888-661-0700 www.penben.com PenBen is Southern California’s Premier Benefit Broker Collaborative Armando Buitrago   abuitrago@penben.com Ron Joy   rjoy@penben.com Alison McCallum   amccallum@penben.com Mark Pattinson  mpattinson@penben.com Eric Trost  etrost@penben.com AutoConnections 2012 Conference & Expo Sept FNCFS t Aria Resort & Casino, Las Vegas Connecting your dealership with the right technologies, strategies, and leaders to create powerful new outcomes. Register Today 908-601-6475 www.AutoCon2012.com Powerhouse Keynote Speakers Plus 70 Workshops, Panel Discussions & Hands-on Labs Free admission to the Automotive Website Awards Ceremony on Sep t 5th PCGConsulting T e c h n o l o g y s S e a r c h M a r k e t i n g s D e s i g n s S o c i a l M e d i a t Dealer Principals receive Complimentary Registration t Expanded Expo Hall: Receive $10,000 Dollars in Vendor Vouchers MORE REASONS TO ATTEND THIS FALL 7. When was the last time you reviewed your entity structure? Consider converting to a lower taxable entity or one that doesn't limit your deductions by restrictive basis provisions. In some cases this will require a taxable change; in others the changes can be performed on a tax-free or tax-deferred basis. 8. Switch your inventory accounting method. This requires filing a Form 3115 with the IRS to take advantage of several preferential accounting methods for new and used vehicle inventory. There are currently at least five special methods that can reduce your taxable income. 9. Focus on reducing personal debt. This makes sense anytime, but this strategy focuses on reducing personal debt first, before business debt. Naturally you’ll need to take rates and terms into account as well, but business interest may save Medi are tax, and business interest may not have the same limitations to deductibility under the new tax laws that apply to personal interest. 10. Finally, manage your rental fleet for tax savings. This strategy takes advantage of a depreciation base that many dealers nearly ignor . Rental fleets often qualify for bonus depreciation and aren’t limited by normal automobile depreciation limitations. Using bonus depreciation now—and selling the vehicle in a subsequent tax year as the fleet is rolled over—can be an attractive tax-deferral technique. Sid Tobiason has more than 33 years of tax experience, with a focus on federal income and estate taxation of dealerships. He leads the firm’s Automotive & Dealer Services tax practice and is the author of the NADA’s Dealer Guide to Business Succession Planning. He can be reached at (858) 627-1448 or sid.tobiason@mossadams.com.