As long as you start using your newly purchased business equipment before the end of the tax year, you get the entire expensing deduction for that year, whether you started using the equipment in January or on December 31st. The same is true for bonus depreciation. This is not the case for ordinary depreciation. The amount that can be expensed depends upon the date the qualifying property is placed in service, not when it's purchased or paid for.

As 2012 comes to an end, experts say business owners should take some time to end the year on a good note and start 2013 out in the best possible way.

Bonuses should follow the same general guidelines used for salary with respect to compensation for C corporation owners. However, it's a wise policy to avoid paying yourself a large, last minute bonus at the end of the year. The timing is often as important as the amount when it comes to raising red flags for a tax auditor.

Form W-2 is used to report payroll information to your employees and the federal and state governments at the end of each year. Examples of just some of the information reported on Form W-2 are:

Here are some of the basic rules for FSAs:

Reporting period:

If your business is a corporation, it is a separate entity that is required to pay income taxes. After your accountant computes the income tax liability of the corporation, an adjusting entry should be made in the general journal to reflect the income tax expense for the year.

If you are earning interest income that will be payable sometime after the end of the accounting period, you need to make an adjusting entry in your general journal. The entry is needed to reflect the amount of unpaid interest income you have earned as of the end of the accounting period.

Compensation in the form of awards and bonuses require special tax treatment.

If you operate your business as an S corporation, the S corporation must file Form 1120S, U.S. Income Tax Return for an S Corporation, on an annual basis, to report income and deductions. Each shareholder must receive a copy of Schedule K-1 (part of Form 1120S), Shareholder's Share of Income, Credits, Deductions, etc., or a substitute K-1. For S corporations with a calendar tax year, the due date for the annual return and the Schedule K-1 is March 15.