If you have your own business, you know profit is everything. You could have dozens of employees and a large building, but if you aren’t in the black, your business won’t stay open long.
It’s crucial to cut costs without affecting the quality of your product. Peter Comisar emphasizes the importance of finding every tax-deductible expense you can. It’s the best way to stay strong, weathering financial storms that come your way. Here are some business tax deductions you should know.
Your Car
Drive your car for business purposes and you can deduct all costs of using it. If you enjoy that car for both business and personal reasons, you can only deduct expenses related to your business. The deduction can work one of two ways. You can keep track of the miles you drive for business and deduct a certain amount for each mile, or you can keep track of all expenses, including maintenance, registration fees, insurance and loan or lease payments. Then deduct them from your business income.
Your Startup Costs and Marketing Expenses
If you started a business this year, you can deduct many of your startup costs. The same goes for advertising or other marketing expenses, including web hosting.
Your Business Meals and Travel
If you have to travel for your business, all travel costs can be deducted along with your hotel stay and meals. The same goes for professional fees and membership dues. Also include recertification costs and training materials.
Your Retirement Plan
You can contribute to an IRA or better still, a Simplified Employee Pension Plan, also known as a SEP-IRA. Each of these allows you to contribute money each year, for which you get a tax deduction up to a limit. The difference between a regular IRA and the SEP IRA is you can contribute close to ten times the amount you’d be allowed to pay to a regular IRA. The SEP-IRA is designed for people who are either self-employed or who own small businesses.
Your Business Utilities
You likely need to use a phone for your business as well as have access to the internet. Both of these are tax-deductible.
Keep these deductions in mind as you run your business. Come up with a file to save all your receipts so you can find them easily come tax season. It’s a simple way to save money and keep your business in the black.
