Regardless of what side you are in the political and philosophical spectrum, we have to take an objective look at the changes being made to our tax system. As a business owner myself, I’m wondering what it’s going to mean for my future. How it’s going to affect revenue, plans, and projections for the next few years.
2018: The Year of Capital Investment
The intention of the new tax code is to create more incentive and room for American business to grow. It includes clauses that cut taxes for pass-through entities (LLC, Sole Prop, S Corp, Partnerships). The idea is that the money that is being saved with these cuts, is more likely to be put back into the business, therefore stimulating capital growth.
So now is the time to invest, How do I go about it?
This is a very important change that affects 95% of American Business and should be considered when planning for the year of 2018 and on. With incentives now written into our tax code, the natural response would be to use this opportunity to expand your business. Even with the margin of savings created with this new tax code, it won’t be a sufficient jump-start the expansion.
Key Steps in Making the Right Decisions
The best way to go about procuring funds to expand your business in this climate is to create a relationship with an alternative lender. An investor-backed financial institution separate from the banks that will be able to provide funding quicker and more efficiently. Alternative lenders are also constantly coming up with better business solutions such as loans formatted for specific industries with customized structures and equations for success. They will be able to handle immediate capital growth needs much better than a traditional bank. Make every dollar count.
There is no point in borrowing money that you don’t immediately put to use. Borrow just enough to have the desired effect, know exactly what that effect is, and how the money will get you there. Do not pay interest on money that doesn’t have immediate intention.
Understand your timeframe and turnaround
Time is an important aspect of borrowing money. Know how long it will take for you to receive a return on your investment. If you don’t see ROI within the term of your loan, you are ultimately hurting your business’s cash flow.
Know your options
There are a multitude of programs with different structures and uses. Communicate with your lender about your needs and your current circumstance in order to get set up with exactly what you need. Every business is different, with a unique set of demands. Do the math and make sure that it’s going to work for you.
Get in touch.
