The end of the year is almost near, which means tax season is closing in. If you’re like the rest of us at the New Hampshire Review, you’re just trying to keep up with everything happening. Paying taxes on top of all of that might feel like too much. However, there are ways to make tax season one of the most entertaining parts of your year. We’re talking about tax deductions.
One of the most effective ways to cut costs for your small business is figuring out what tax deductions you can take. There are dozens of ways to take advantage of the size of your business to get tax cuts. Saving that money goes a long way.
Here are a few tips which will help you figure out which deductions you qualify for:
Vehicle Expenses Deduction
If you have a private van which you use for business deliveries, it’s possible to reduce the amount that you spend annually on fuel. Do this by estimating what you pay as actual expenses, and then using the IRS standard mileage rate to see what you should have been paying.
That might seem like a stretch, but to save money for your business, it’s smart to think outside of the box. Outlandish tax deductions like this put some money back in your pocket which you can use later. Playing it smart adds up in the long run.
Work at Home Deductions
Another way that you can get a little more money in your pocket is if you have a home operated business. If it’s taking up your personal space, or if you work at home from time to time, you may qualify. Keep in mind that this is a deduction which only works if you have a dedicated home office.
You can calculate the deduction you should get as a ratio between the entire size of your home and the amount of space that the office occupies. It is, however, essential to follow the IRS guidelines when going for this deduction because failure to do so could lead to a costly audit.
Salaries and Wages
If you are the sole proprietor of your company, you may not be in a position to deduct draws from the salary that you take. However, you can get deductions from the wages which you pay to your employees. Other payments that you can factor in the deductions include bonuses, meals, accommodations, and related services. Costs such as payroll software could also be a deductible.
There are many other deductions which you can help you put as much money back in your pockets as possible. You need to consult a competent tax accountant to help you perform an audit of your business expenses and figure out where you can claim deductibles.