When speaking with any new business owner, they typically have 3 top concerns – what’s the right entity for me, how can I maximize my profits and what can I deduct as business expenses? The answer to that last question is – it depends (like most things in tax). Generally speaking, if it’s both ordinary and necessary to conduct business, it’s likely deductible, but the manner in which you can deduct may vary. Below are the most commonly questioned business deductions. Incurring any of these expenses? Schedule a consultation with ASE Group so that we can help you quantify the deductibility of the expense and ensure you are recording it correctly to maximize the deduction. .
Business Use of Your Car
If you use an automobile strictly for business purposes, you can deduct the vehicle’s entire operating cost. However, if you use the car for business and personal driving, you can deduct the business usage costs (such as mileage, gas, oil changes, repairs, etc) or the mileage, depending on which is most beneficial to you.
Marketing and Advertising
Have you ever paid for a social media ad or to boost a post related to your business? Do you have business cards? A website? Do you use custom stationary or send personalized thank you cards? Any costs to promote or advertise your business are fully deductible.
Phone & Internet Use
If your business requires the use of a phone system and/or internet (which most do), you can deduct your monthly bills (or a portion of them if you use it for business and personal means).
Any educational expenses that bring value to your business or help increase your professional level of expertise qualify as tax deductible. This can include a certification and the yearly amount of continuing education hours required to obtain that certification. Unfortunately, previous expenses for tuition, books, or other student loans are not applicable.
If you’re anything like me, office supplies are one of my weaknesses. I just love staying stocked up on paper, notebooks, post-its, pens, highlighters, etc., all of which you can deduct from your taxes.
Did you need a new printer? Is your computer chair holding on by a few screws? Wobbly desk that needs to be replaced? Office furniture is also considered a valid business expense.
If you’ve bought or downloaded software for your business, this can be deducted. Scheduling tools, accounting programs, Microsoft Office, anti-virus protection - it all counts!
Keep in mind, this is just a few of the most common tax deductible expenses a small business may incur. Remember to keep record of these purchases for your taxes to justify the expenses. Need help with your business taxes and maximizing your deductions? Schedule a free consultation call with ASE Group and learn how we can help!