I’m saying all this because….the March 15th LLC, partnership and S-Corp tax deadline is fast approaching. If you’re still scratching your head on how you can maximize your tax savings, don’t fear! I’ve compiled the top 21 deductions for business owners in this handy dandy email.
Let’s get started.
Contractors/Freelancers. Paying the people that keep your operation going is totally tax deductible. This is usually one of the higher deductions a business owner can take. So if you paid folks, deduct it!.
Employee pension plans: As a business, if you made any contributions to employee 401(k)s, you can deduct those costs on your tax return.
Consultations: Attorney and accountant fees being tax deductible isn’t the only reason why you should work with them, but it’s a nice perk.
Office space: If you run your business from home or just keep an office there to get some work done on the weekends, you can deduct the costs associated with needing to do work.
Travel costs:This can include: business meals, plane tickets, parking, hotel, conference costs, etc.
Basic office supplies: Printers, printer ink, computers, anything needed to do your job!
Software: This includes the actual cost of the software including subscription costs.
Inventory: If you sell or manufacture products, you can deduct the cost of goods sold. This could include the cost of materials and the labor needed to make the item.
Salary and benefits: Employee salaries, services, health plans/insurance and properties are deductible! This also relates to self-employed costs.
Utilities:. You can fully deduct utilities if you use them exclusively for business. This includes phone bills, but as always, make sure to separate personal from business and only deduct the business portion.
Repairs: All repair or maintenance costs relating to business
HInsurance premiums: I know this one is major! Health, liability, auto, etc.
Interest: On business loans and credit cards. Yes, this too!
Lifelong education: Books, magazines, professional programs, DVD, membership fees, certification costs are all tax deductible.
Standard IRS mileage: You may use the IRS’s standard
mileage rate to calculate a commercial vehicle deduction. The 2019 rate is 58 cents per mile which is worth it if you drive a lot in your business.
Actual vehicle costs: Actual expenses cover all costs related to fueling, repairing and maintaining your commercial vehicles. Calculate your actual expenses AND the IRS’s standard rate to see which saves you more and choose the higher of the two.
Networking: If you’re meeting with a client or doing business over lunch – it doesn’t matter if it’s a sports bar or fancy dining, it’s deductible.
Cash/Tips: Tipping on trips or meals associated with business will be tax deductible
Advertising: You can deduct what you pay to promote your business – billboards, online ads, anything.
Sponsorships and gifts: Yes, even this too!
Depreciation: If you purchase property — furniture, computer, a building, vehicles, etc. — anything that loses value, you can claim on your taxes over the course of the property’s life..
I hope you found this helpful! Here’s to saving a buck where you can, because it really makes the difference.
To more money in our pockets,
Chika
8 Easy & Effective Tax Write-Offs for Creatives & Service Providers
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