Welcome to Business-Software.com’s Tax Week. We’ve developed this content to provide all the information you’ll need to make a smart and informed decision about your software selection for tax filing season. Catch up on all of our Tax Week content by visiting the Business-Software.com blog.
As Benjamin Franklin said, “A penny saved is a penny earned.” Likewise, every penny counts when it comes to saving money in a business.
What many small business owners don’t know is that they may have overlooked expenses that can be deducted from their taxes. Buying furniture, food or even software can be deducted when filing your taxes as long as you save the receipts. By remembering these small expenses, you can save your business thousands of dollars each year.
To help you check what you can save on, Business-Software.com has compiled a list of the best money-saving tax deductions for small businesses:
Expenses such as office supplies, utilities and repairs can be deducted as current business expenses. You can find out more about insurance tax deductions on the IRS website.
Any legal fees from tax professionals are fully deductible as a cost of doing business. This includes accountants, lawyers and other professional consulting fees. To learn more about this deduction, click here.
Almost anything travel-related can be deducted. For example, airfare, hotels and on-the-road expenses are 100 percent deductible. Check out this page on www.irs.gov for more information on travel expense deductions.
If you use a credit card to pay for business purchases, carrying charges and interest are completely tax-deductible. Mortgage interest, credit card charges, interest paid on other loans and interest on payment plans are all 100-percent deductible. To learn more about this, visit the IRS website.
There is an IRS tax code that allows businesses to write-off certain items of equipment over time. This code states that if a company purchases a machine, equipment or technology, they can write off the entire purchase price for the year they bought it.
Essentially, you can buy any software at full price and have it written off during tax season. So, if you bought software in 2014 at full price, you can deduct it from your taxes.
As stated from section179.org: “Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. That means that if you buy (or lease) a piece of qualifying equipment, you can deduct the FULL PURCHASE PRICE from your gross income. It’s an incentive created by the U.S. Government to encourage businesses to buy equipment and invest in themselves.”
The cost of advertising is deductible as a current expense. For example, promotional costs that create goodwill for the business such as community work or sponsoring a little league baseball team are deductible as long as there is a clear relationship between the sponsorship and your business. Provided that the advertising is directly related to your business, you can deduct 100 percent of the cost. See what types of advertising costs you can deduct here.
We know it can be a hassle to go through each of these expenses, but it will all be worth it when you see how much money you saved at the end of it all.
It’s better to be able to say to your colleagues, “I wrote off all of the available business expenses and saved thousands of dollars; let’s celebrate!” than to say, “I forgot to write off some expenses that could have saved us thousands of dollars; maybe next year.”
For a more comprehensive overview of tax credits and deductions available to small businesses, visit the IRS Tax Guide for Small Business. To find the best tax software for your needs, be sure to check out or post on the top tax filing solutions for businesses.
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