WANT TO BECOME A BETTER ENTREPRENEUR?
(All In Less Than 5 Days)
I want to become a better entrepreneur and start making more money.
I don’t want to make more money, even if I could do so in 5 days or less.
When it comes to small businesses, it’s important to know everything that can be deducted. You may be paying way more than you actually should. Here are a few ways to have your CPAs pay for themselves by discovering these deductions.
There’s a shocking number of people who work from home that choose to not deduct the cost of doing so. There are many reasons for this, the primary of which is that many small business owners believe that this is a red flag for an audit. That’s not the case. If you have an area of your home that you use exclusively for business, you should deduct it. Starting with taxes this year, the IRS will have a much easier method for home office deductions.
Did you know that your electronics used for business can be deducted? Smartphones and tablets are eligible for full deductions, provided that they’re used primarily for business and the business is profitable. You can also deduct all monthly service charges. If there’s minimal personal use of the smartphone or tablet, such as taking classes online, they can still be deducted. More information can be found on the form that talks about depreciating property — publication 946.
If you’re a frequent traveler, you should know that you can get a lot of the extras associated with traveling deducted. You can deduct every little thing, from laundry to taxed lodging. You can also deduct the fares associated with taxis, buses, trains, and subways. You don’t have to keep the receipt — as long as you keep it under $75, just keep track of the costs. You may think these are all small fees and shouldn’t be deducted, but a ton of small fees can add up to a large amount.
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This doesn’t have anything to do with moving the actual office, but rather your personal home. To qualify for this deduction, there are a number of qualifications you must meet. Your move should have been in connection with your job. Your new place of business must be more than 50 miles farther from your old home than your workplace was. You’ll find the place for moving expenses on your Form 1040 tax return.
Software bought for business should be depreciated over a 36-month period, but there are some exceptions. If you bought software between Jan. 1st, 2003, and Dec. 31st, 2013, it’s eligible for a Section 179 deduction, which means you can deduce the full cost of the software. If the software was included with a computer, it’s treated as part of the hardware and is depreciated over 60 months. You can write off a whole computer under Section 179 in the first year if the total cost is within the Section 179 annual deduction amount. If you’re buying a large amount of computers, this equals a huge amount that you can deduct.
Once you add up the deductions, you might be surprised at the total amount of them. Do you know any other deductions that small business owners can make? Leave a comment below and let us know!