Hey there BGB’ers. It’s that time of year again!
You know… TAX TIME. Woo!
Gotta love paying out your hard-earned cash to the IRS right? And it becomes a wee bit more complicated when you are running your own small business and not just working one of those dreaded J.O.B.s.
But hey, that doesn’t mean there aren’t some perks to being self-employed, including the ability to write off qualified expenses.
The key term you need to remember there though is they absolutely must be qualified expenses.
Tax Wisdom 101
Don’t mess around with the IRS, they will hunt you down and string you up by the proverbial toes!
If you’re unfamiliar with filing as a small business, I’d highly recommend you consult with a tax professional and skip being a DIY’er on this one tiny thing.
You deserve to get the absolute best return possible based on your situation and besides, why put any extra money in the government coffers than what’s required? Adopt the H&R Block motto and never settle for less!
All that said, what exactly are some of the more common qualified expenses anyway? There are actually many my friend, but I’ll share with you my fave 5 to get you started. You can also check out the IRS’s view on deducting business expenses.
Office Supplies and Furniture
Might be a no brainer, but you’d be surprised how many entrepreneurs forget to save receipts on stuff like printer ink, paper, staples, pens and pencils, your office chair, that swanky new office desk and a host of other office related paraphernalia.
All of those things can be claimed as a tax-deductible business expense, and depending upon how much you shell out throughout the year can put a nice sized dent into what you have to pay in.
Computer Software and Biz Subscriptions
Yep, Uncle Sam says you can deduct the cost of software related to your business as well. So that $300 bucks you just plunked down on that invoicing system? Write off! That $50 bucks a month you pay out for automating your email marketing campaigns? Write off!
If it is biz related and you spent money on it, you get to deduct it. Just make sure you’re keeping receipts and ask your tax preparer what the cap is on the amount you can deduct.
Child Labor
Bet you never thought you’d actually be rewarded for child labor huh? But in reality, if you have a child under the age of 17, you can deduct their salary as a business expense as long as you’re a sole proprietor or in a joint business with your spouse.
Once you incorporate, this is no longer an option however. And teaching your kids entrepreneurial skills early and the importance of saving are like icing on the tax free cake!
Insurance Premiums – Woo!
OK so this one makes me secretly do a little happy dance. Insurance premiums can be ridiculously expensive! But some businesses are able to deduct their premiums as a self-employment expense.
Again there are a few rules and hoops with this, so talk to a professional tax advisor to figure out just how much is allowable to you. Heck even if I can write off a few months worth of premiums, I’m a happy camper with this one!
Phone Charges
IRS says phone charges are an allowable expense provided they are business related. The best way to keep track of this is to run two phone lines and use one exclusively for business if you can.
If not, you can still deduct charges from your family phone bill you will just need to be diligent in keeping the phone records and noting which calls are which.
And there you have it. 5 simple tax deductions for entrepreneurs to take advantage of with the help of an experienced tax professional willing to show you the ropes.
Got tips for other deductions entrepreneurs can take advantage of? Please drop them in the comments below.
SPONSORSHIP STATEMENT
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DISCLOSURE STATEMENT
As you know BGB doesn’t run on fumes and the FTC requires that I make all and sundry aware of it whenever I receive any sort of financial kiss by doing what I do. So there you have it- this is a sponsored post which means I got to collect a bit ‘o monetary compensation for writing it. Useful tips for you, brand exposure for my sponsor, some digital “green” for me. Win, win.
