Dealing with business taxes is complex even without the massive overhaul we've seen pushed through in a reckless manner. Studies have show that people paid to prepare taxes often get them wrong. Of course you and I aren't experts. But we have to take measures.
The final version of the tax bill is yet to be decided, and many things could change between then and now. However, chances are that the final results will still be significantly different from what you're used to. Even as things remain a bit hazy, it's time to start planning.
1. Review the bills as they stand
To plan, you need as much information as available. That means -- sorry, as this is painful -- reviewing the House and Senate bills. You don't want to look at the formats that were actually passed because they are almost unreadable. You'd have to flip between one section of tax law and another, mentally making the additions and subtractions to see how they read.
Instead, go to the section-by-section descriptions, which explains essentially what each part of the bill changes. The House and Senate versions are available separately. This won't be a perfect representation, particularly as there were deals being cut and changes to the Senate's version made through December 1 to get enough senators on board to pass the measure. But it is the best you can do at the moment.
Read the sections on businesses. Understand as well as possible the changes for both corporations and pass-through businesses, which include sole proprietorships, partnerships, and LLCs. Because the world is turning upside down, you may need options.
2. Recognize that things may have to change -- or not
Depending on the circumstances of your business, it may be necessary to reconsider how you have it organized. If a pass-through business was effective before, it might not be now. Or, contrarily, if a major proposed extra deduction on certain type of pass-through businesses is signed into law, you might find that shifting from a C corporation to an S corporation or LLC could pay off. As service-based pass-through companies aren't eligible for the extra deduction, would it make sense to wrap such a business inside another that would be eligible? Hard to know for sure.
There's no way any checklist could tell you what form will make most sense. Even professionals can't tell you yet, as there isn't a final version that the House and Senate have agreed to. But you do need to consider whether you'll need to make a rapid change by early in 2018.
3. Get competent help
These considerations aren't something you'll likely be able to do on your own. You want advice from smart professionals -- CPAs and lawyers -- as to your options. Don't assume that everyone who prepares taxes or does accounting will be able to provide solid help. Talk to others, check reputations, and find appropriate resources, recognizing that they won't yet know how to advise you. But if you set up a relationship now and indicate your concerns, you can move more quickly when things seem settled.
4. Don't forget this year's taxes
Future tax planning has to include this year. You'll want to consider what deductions you can make to reduce your obligations. However, those strategies also depend on the changes to the tax law. For example, if you could get an extra deduction off the top of a pass-through business, it might make sense to push revenue into next year. If the new rules end up excluding anything you've been able to deduct (even on the personal part of taxes, like state and local taxes), try to pull as much as you can into this year.
5. Don't forget your employees
If you have employees, take a moment to consider whether you've asked them to shoulder any business expenses, because they will likely lose deductions they would once take. Someone -- a commission-only salesperson -- contacted me on Twitter to mention how the proposed elimination of business expenses by employees through filing a Schedule A could hit him hard because he bears many travel expenses. If any of your employees find themselves in analogous situations, you might need to start reimbursing what you hadn't or even discussion new relationships. If the expenses are high enough, maybe they'd be better off as independent contractors (if legally possible) with the ability to deduct the amounts on a Schedule C.
It's going to be a huge mess for all of us. Get educated, find help, hang in there, and see if you can find ways to make the changes benefit your business.