Did you know there are many penalties associated with taxes for businesses? Avoid penalties and fees by staying organized with your taxes. If you want to learn more about small business taxes, we can help.
In this guide, we’ll go over how to save money on taxes.
Want to learn more? Keep reading.
The taxes you pay for your business can become deducted as business expenses. Some taxes will get included in the business expenses you pay.
You will pay a fuel tax for the gas you use to drive around for business-related tasks. The tax will get included in the cost of gas.
When you pay sales tax on office supplies, the sales tax will get included in your office expense.
You will pay other taxes separately but deduct them as taxes on your business return. These include state tax on your gross business income.
It also consists of state and federal payroll taxes. It includes taxes on business property and personal property tax on business assets.
You can also avoid late fees by filing on time. Make sure you file timely.
Benefits you pay under qualified benefit programs to your employees are also deductible. Deduct the price of qualified health plans, adoption assistance, or even educational assistance for your employees.
Do you use your vehicle for business-related tasks? Your expenses will give you an excellent deduction.
Each time you go to the office, or a store for your business, you can get a deduction. Track your business miles and get the tax deduction you deserve.
Some people will take the standard mileage rate or deduct the expenses for driving.
The IRS asks you to track your commuting, personal, and business miles to claim a deduction. You’ll also need the business purpose of your miles.
Track costs for oil, gas, service, insurance, depreciation, and lease payments.
Track actual expenses. Do you run your business from home? You can track business mileage when you leave your driveway on company business.
If you work at another location, count business mileage from your central location.
Do you get income from self-employment? If you buy your health insurance, you could qualify to deduct your premiums as an adjustment.
The coverage can be for you and your spouse and dependents.
If you buy equipment or other assets, but don’t expense them, get the deduction for the current year.
Even if you purchased them previously and didn’t expense them then, you can use them for the year’s depreciation for the asset.
Do you have an area in your home that you use as a home office? You could get a deduction for a home office.
You need to meet specific rules. For most cases, the space you claim will need to get devoted only to your business.
You will deduct direct and indirect expenses if you claim a home office. Direct costs include things like painting or repairs. You can claim 100 percent of these kinds of costs.
Indirect expenses include a percentage of the amount you will pay for rent, electricity, and more. You should divide the square footage of your house by the number of square feet in your office.
If you can’t find all the bills, you could use a simplified home office deduction. Take a flat five dollars per square foot deduction for your home office and up to a max of 300 square feet.
The fees you pay for the Internet will add up. Make sure you keep track of all this information. Do you also have to pay for subscriptions for malware and virus control?
Do you need subscription software for your employees? Keep these receipts so you can get a deduction.
Did you know you can deduct 25 dollars for each person of the cost of presents given to vendors or customers?
Yet, an exception will exist for people who bear your business name. Deducting the price of entertainment is a little more challenging. These costs aren’t deductible unless the event has a direct relation to your business.
You should look at working with a tax professional before you make any decisions. Make sure you understand what you can spend on and what things can get deducted.
Choose someone who will partner with you and your business throughout the year. You will need help during the tax year, and not only for the tax season.
Find an expert who will also represent you before the IRS in the event you do get audited.
Work with an enrolled agent. They are a professional from the IRS because they passed a challenging and three-part test. Some agents may have also worked with the IRS before, as well.
We hope this guide on how to save money on taxes was helpful. Consider keeping track of all your expenses for your business so you can get a return.
Keep track of your expenses for travel and the miles you travel for business. Keep gas receipts, and work that gets done on your business vehicle.
Want to make your business more productive? Do you need more business tips? We have so many helpful articles for you to check out.