Smart Small Business Tax Deductions

Increasing sales is not the only way to make your business more profitable. Decreasing what you spend is just as viable a strategy toward profitability.  Every purchase you make for your business is potentially tax deductible, so it pays to know what purchases are legally tax deductible. By using savvy tax strategy, business owners can save thousands of dollars annually.

The Internal Revenue Code describes deductible business expenses as "ordinary and necessary", so the expense must be typical for your type of business in order to be legally deductible. The best way to ensure that you claim all of your deductions is to keep all receipts for every purchase you make for your business. Your tax professional can then determine which expenses to claim as deductions. Receipts and detailed records may allow you to deduct business expenses such as:

Professional fees (ie., accounting & legal)

Utilities

Equipment purchases & repairs

Postage & Office supplies

Advertising

Insurance Premiums

Rent

Travel

Subscriptions

Bank fees & Interest

Employee Wages

The smartest way to handle business taxes is to educate yourself on basic business tax deductions, keep all receipts, organize your income & expenses using a spreadsheet or accounting software such as Quickbooks, and seek out a Certified Public Accountant (CPA) to help with your tax strategy and preparation of business tax forms.

Also see:  Freelancer's Tax Info & Spreadsheet