Date: February 16, 2022
The Sneaky Hidden Tax
Inflation is often referred to as “the hidden tax”. Did you know that tax brackets aren’t adjusted for inflation? This is felt on a larger scale during periods of higher inflation, such as now. To put it simply, inflation is basically your purchasing power decreasing over time. For instance, 30 years ago, a trip to the store with $50 would have been able to buy much more than that same trip to the store today. Of course, we take into consideration that wages have increased in those 30 years as well. But the fact that the tax brackets are not adjusted to account for periods of higher inflation is ridiculous and felt by business owners everywhere.
It comes as no surprise that the government reaps the rewards of inflation. It leaves the business owners and consumers with less of their money and puts that money in the pocket of the government. (Big surprise, right?) Since inflation is a part of the cycle historically and will continue to be so in the future, it is important to know ways to combat it. Being aware of it is the first thing you can do. It comes as no surprise that it is purposely confusing and often misunderstood – read more on inflation here.
As a business owner, one of the best ways you can protect your business is to have a tax plan. It is a legal, transparent way to strategically save you more of your money so you can invest in your business, your retirement, and yourself. Why give the Government more of YOUR money? It is the best way to ensure you are protecting your assets and maximizing your legal deductions. The best way to beat inflation is to have a plan in place that lowers your tax obligation and exposure. If you don’t have one in place, we are here to help. Click here to schedule with one of our tax experts so you can kick this sneaky little hidden tax to the curb.