Avoiding the fiscal cliff could benefit Chicago area businesses

At the end of last year, residents throughout the nation waited anxiously to hear whether the nation's economy would indeed fall over the fiscal cliff. Small business owners in the Chicago area were no exception. While it is impossible to please everyone, all of the time, when a deal was struck on the first day of the new year, many people, including some owners of small businesses, were relieved, believing it will result in more good than harm.

In order for any business, of any size, to be successful, there must be a customer base that is ready and able to spend money on the goods or services that are being offered. Prior to the passage of the deal some small business owners were afraid that money in the pocket of consumers could disappear. Since the deal went through however, there is great optimism that willing customers will be able to pay for the things businesses are offering.

Some Chicago area small businesses are likely also pleased with the passage of the deal based on how it will impact the tax rate applicable to each. While those businesses that make more than $450,000 a year will be taxed at higher rate, most of the small businesses in the Chicago area do not hit that threshold.

As is the case in many situations small businesses face, when there are questions regarding business tax matters, it is generally a good idea to work with an attorney who handles tax law issues. This is an especially good idea when a law could potentially change the status quo is passed. Taking proactive steps could prevent a tax audit later.

Hopefully the finalization of the deal will be a good thing for small businesses in the Chicago area. It may allow for businesses of this size to expand in ways that they previously could not. This would undoubtedly be a good thing for all involved.

Source: Chicago Sun-Times, "Fiscal cliff tax law eases minds of small business owners," Francine Knowles and Sandra Guy, Jan. 3, 2013

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