Areas To Target For Small Business Tax Reduction
As a small business, you may be looking for ways to reduce your tax bill. There are many areas that you can target to take greater deductions, so check in these categories to see if you've missed anything on your past few tax returns.
Your office equipment can be deducted in a few ways. If you want to take the total cost as a deductible in the first year, that's an option. But you can also spread out the deduction over a few years to account for depreciation.
You may not be aware that your subscriptions are tax deductible. This includes business journals and magazines that you subscribe to. It also includes software that you use for work purposes. If you need to be a member of a professional association in order to conduct business, you can deduct this charge also.
Business-Related Client Expenses
Client expenses are another area where you can often find more deductions to claim. If you have had any outings that could be considered as business development, make sure that you save those receipts so that you can put them into your client expenses category for deductions.
A car can be a tax deductible expense whether your company uses your personal car or your business owns its own car. If your car is split between personal and professional use, you will need to be more careful about documenting how many miles you travel for work. You can deduct these portions of your auto insurance, gas expenses, and wear and tear on the car.
Hopefully, you've been deducting the costs of starting up your business all along. There is a 15-year window in which you can deduct these expenses; consult your accountant or tax reduction specialist on how to do this effectively.
Finally, financing charges are a portion of your income that you can take out of your earnings. This includes things like loan interest, but often not expenses that are incurred because of late payments and errors on your part.
These are only some of the possible business tax deductions to consider. Since there are so many options, it often pays to hire a tax reduction consultant to help you figure out which laws apply to your business. Getting a professional opinion is often more cost- and time-effective than pouring over the books and figuring out the intricacies of tax law.