20 Tax Deductions for your Business

20 Tax Deductions for your Business

The hardest thing in the world to understand is the income tax.

- Albert Einstein

One of the easiest ways to reduce your income tax bill is to ensure you’re claiming all of the tax deductions available to your business. Staying on top of your deductions throughout the year can be a struggle and many entrepreneurs find themselves trying to piece things together at year end and run into difficulties. Trying to remember an auto expense that occurred in February 11 months later is easily missed which is a missed opportunity on tax savings.

the magic of bookkeeping

One of the benefits of outsourcing your bookkeeping is that you’ll have accurate records to help tally up your deductions. No more headaches during tax season!

We love sharing helpful information so we’ve put together a list of 20 tax deductions for your business.

20 Tax Deductions for your Business

Cost of Goods

Such as the cost of raw materials, direct labor, overhead, storage and freight.
Business Rent

If you are renting your business property you can include your lease payments.
Equipment and Machinery Rent

From computers to light fittings, telephone switchboards, and specialized medical equipment.
Business Utilities

Utilities used for business operation.
Insurance

Such as property, liability, auto or worker’s compensation.
Employee Salaries and Benefits Paid

Salaries paid to employees and officers as well as some employee benefits such as qualified retirement plans, dependent care assistance, health insurance, etc.
Contracted Labor

Payments made to independent contractors or freelancers associated with your business.
Advertising and Marketing

Expenses related to business marketing or advertising.
Legal Services

If you have incurred legal expenses for your business.
Accounting Services

Payments made for business accounting and tax preparation services.
Auto Expenses

Expenses related to the business use of car, as well as car lease payments.
Travel Expenses

Certain business-related travel expenses.
Equipment and Machinery

You can use 179 special depreciations to take advantage of using full depreciation on certain assets purchased for the business.
Interest Expense

Interest payments made on the business loans.
Bad Debt

Business debt incurred in trade or business which has been determined worthless.
Taxes paid

Payroll taxes, real estate taxes, state taxes, but not federal income tax payments.
Office Supplies & Furniture

Expenses related to office depending on the category are either expensed or depreciated.
Moving Expenses

Such as cost associated with moving the equipment, supplies and inventory from one business location to another.
Business Meals

Business related meal expenses.
Education

Businesses provided educational benefits such as classes, workshops that increase knowledge and skills.

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