If you use a home office, that space is deductible as well, including a proportionate percentage of your real estate taxes, utilities and other home maintenance expenses.īut if you use a coworking space as a place of business - essentially, a happy medium between the two examples above - your usage fees may be tax-deductible as well. If you rent an office, you can deduct most of the expenses associated with running it. The last thing your small business needs is a penalty due to improper deductions.
If you’re using personal financing for business purchases, keep impeccable records of how the funds were spent if you plan to deduct the interest on them. If your financier doesn’t issue an annual statement detailing interest charges, you can typically find the amount billed on your monthly or quarterly statements.Ī word of caution, though. If you get a business loan or credit card, or if you use a personal loan or credit card to finance business purchases, you may be able to deduct any interest the financier charges you. Your accountant can help you determine whether or not your clients’ bad debts can be deducted, or you can find more information in the IRS Tax Topic 453 document. Writing off a loss as a tax deduction isn’t the same as receiving full payment, but it certainly takes some of the sting out of the situation. Megan Sullivan, writing for Quickbooks, offers three examples of expensable bad debts, including “loans to clients and suppliers, credit sales to customers, and business loan guarantees.” If you have clients who aren’t able to pay, their losses may be deductible as bad debts. The only requirement is that they be used for your business - People magazines delivered to your home that you occasionally remember to bring in to the office don’t count. Whether you read them or plan to use them as waiting room or lounge materials, magazine subscriptions can often be deducted as a business expense. Keep your mileage records up-to-date throughout the year to make life easier.
However, if you’re traveling to a specific destination (say, a client’s office) exclusively for business purposes, you should qualify. The IRS’s Publication 463 has the full details, while another document gives the Standard Mileage Rates to use in calculating your deductions.Īs a note, you typically can’t use this deduction to expense trips to and from your office. However, even if you use your personal vehicle for business purposes, you may be able to deduct mileage for any work-specific trips. If you operate a business vehicle - for example, as part of a construction or landscaping fleet - you can generally deduct the full expenses associated with purchasing, running and maintaining it.
0 kommentar(er)
