Do you want to save a ton of money on your income taxes? Here are the top 12 small business tax deductions you can track now to save big on your taxes!
Deduction #1: Business Use of Your Car
If you use your vehicle for business purposes, you can deduct the costs of your usage. There are two ways you can do this to see which method gives you a greater benefit.
Deduction #2: Wages Paid
This includes any payments that you make to employees including salary, wages, bonuses, and commissions. However, you cannot deduct payments made to sole proprietors or partners as they are not considered employees.
Deduction #3: Contract Labor
If you hire freelancers or independent contractors, you can deduct their fees. You’ll have to send them tax form 1099-NEC if you paid them more than $600 dollars.
Deduction #4: Supplies
Even such things as postage and cleaning items within the offices are considered deductible expenses. This is why it is important to keep a close record of what you buy for business.
Deduction #5: Rent
If you rent a space for your business then you can deduct the full amount that you pay in rent each month. This can be an office, storefront, warehouse, or factory as long as the business is conducted within the space.
Deduction #6: Home Office Expenses
If you mainly work out of your home, you can then deduct part of your home expenses. You can deduct a percentage of your rent or mortgage based on the square footage that you use. You may also deduct a portion of real estate taxes paid and percentages of utilities. And if you have specific work done to the office portion of your home, for instance, painting, this too can be written off.
Deduction #7: Utilities
The electric, gas, and water that you pay for your office/workplace are all deductible. They can also include mobile phone costs and Wi-Fi, as well as trash removal.
Deduction #8: Advertising/Marketing
Most expenses attached to advertising are fully deductible. This includes costs related to your website and online presence, brochures and even costs from any trade show you might have attended.
Deduction #9: Legal and Professional Fees
Any payments made to lawyers regarding your business are deductible. You can also deduct fees paid out for professional services such as lawyers, accounting, bookkeepers, and tax preparers.
Deduction #10: Travel
Transportation and lodging are fully deductible expenses. You can even deduct meals and laundry while on your business trip. Be sure to always keep records of any expenses while traveling for business.
Deduction #11: Business Insurance
This can include property coverage, liability coverage, and even workers’ compensation.
Deduction #12: Education
Education costs are fully deductible when they add value to your business and increase expertise. Valid business education includes classes to improve skills in your field, seminars, webinars, and even transportation expenses to and from classes.
These are just some of the relevant tax deductions you can use for your small and growing business.
First Union Lending Can Help You With Business Funding!
While these tax deductions can be used when you file taxes, you may need funds now to cover such expenses. First Union Lending offers numerous financing programs designed with small businesses in mind. Our business loans are fast and flexible, with financing options ranging from $5,000 to $2 million dollars.
Call today to learn more about our various financing solutions to help your business grow and become successful.