Tax Day is coming up fast, which means that you have to get your finances in order as soon as possible. If you don’t, you may forget to take some key small business tax deductions. These tax write-offs could end up saving you a lot of money if you utilize them correctly.
Although some items are clearly tax deductible, including office rent, utilities, and employee costs, others may not be so obvious when filing taxes. Aside from hiring an accountant to assist you, it pays to do research on your own as well.
Are you unsure about which small business expenses and tax write-offs you can make? Look no further. The following is a list of tax deductions that you may want to claim when doing your tax preparation this year.
Did you buy furniture for your office this year? If so, it’s tax deductible, and you can claim your chairs, desks, and couches as small business expenses. You’re able to either write off the full amount, or use the seven-year depreciation method. While you have the option of deducting the entire cost in the year in which you put the items in service, depreciation may be more favorable if you expect your tax bracket to rise in the future.
2. Home Office
If your home office is your primary place of business, or it is where you meet with clients and customers, you can deduct certain home office expenses. To figure out how much your tax deduction will be, measure your home office and divide by the total square footage of your home. This percentage determines the amount of your mortgage or rent, utilities, and expenses related to your home office that you can claim.
3. Travel Costs
If you’re traveling for work, chances are, you can take deductions for taxes on all of your costs. This includes airplane and train tickets, baggage fees, hotels, Wi-Fi access, business use of your car, etc. If you eat out while traveling, only 50 percent is deductible.