IRS tax deductions for small businesses

At Mount Bonnell Advisors, we understand that the end of the year is often a hectic time for small business owners. Between all the holidays and business trips, you may feel like your annual taxes have taken last priority. With a busy schedule, trying to get in last-minute donations and adequately record all deductions may prove difficult. But it does not have to be. You will save quite a measurable amount of money if you ensure that you do not miss any deductions. Below are some significant tax deductions for your small business that you should not forget while filing tax returns.

Transportation expenses

Regardless of what type of vehicle your organization utilizes, tracking your transportation costs is one of the most straightforward approaches to get cash back when tax season comes. Make a point to clutch any receipts from service stations, any auto body shops expenditure, parking payments or tolls you amass while working Also keep track of the miles you travel while working. The IRS standard mileage rate, otherwise called the sum per mile, one is permitted to deduct commonly around 54.5 cents per mile. In order to get the maximum refund, deduct whichever amount is higher from your expenses.

Charitable donations

Did you ever reflect and realize that gifts are tax deductible? Indeed, you can help your area and your business at the same time! By making a qualified donation to a nonprofit organization, you might be able to record it as a tax deduction when April comes around. Ensure you get a receipt and remain within your taxable income limitation to qualify that gift as a deduction. We recommend utilizing labels in your email inbox for sorting these electronic receipts to make it easy to locate the receipts.

Rent

Rental expenses for all of your business spaces including storage units and factories are also tax deductible. If you work from home, consult with a tax professional to determine the total amount you can claim as a tax refund. Tax specialists at Mount Bonnell Advisors are ready to give you the right advice regarding these options.

Utilities

When incorporating rent in your tax deductions, do not forget to include utilities. Utilities include anything relating to your office space like the water, electricity, gas, internet and phone bills. Much like claiming rent, it is essential to consult with a tax professional to determine the total amount you can claim if you work from home.

Continuing education

If you are taking any workshops or online classes applicable to your small business or for professional certification, as business-related instructive costs they might be tax deductible. Such educational opportunities come in handy, especially if your employer or field requires them. These workshops and additional educational opportunities should be geared toward your industry and position to ensure maximum success. This includes renewing a professional license, remaining compliant with regulations and/or completing a series exam.

Insurance

Almost all insurance relating to your business can be fully deductible on your taxes. This includes professional liability insurance, renters insurance and life insurance. Deducting health insurance expenses on your taxes may vary depending on the company and by state law. Be sure to consult with tax professionals when completing this section of the tax returns.

Child care expenses

If you offer your workers several means of child care assistance, a stipend or on-site day care, you deserve an award for being a magnificent employer. Almost all child care related expenses are tax deductible, which includes things like educational assistance and dependent care assistance.

Travel

At one point, you or one of your employees may want to travel out of town for business purposes, Which can accrue a series of costs that are all tax deductible. Examples of these costs include conferences, flights, other modes of transportation and lodging. There are several qualifiers, however, outlined by the IRS to claim any travel deduction. Updating yourself with the qualifiers and conditions is essential. Thus, it would be best if you consult with a tax professional before making any business-based travel decisions.

Professional services

Any charges you pay for professional services you receive may be tax deductible. This may include services such as a contract-marketing consultant or tax professional. Even so, the IRS has several restrictions about the kind of services you can count as expenses on your taxes.

Phone calls

Any business calls you make are fully tax deductible. Regardless of whether you make them on a personal or business phone, all business-related phone calls qualify. Make a point to keep close records of the calls you make, so you are ready to isolate them from private conversations. While a personal device is only partially deductible, a separate business line may be fully deductible.

Please note that this blog post aims to give information to our audience. We recommend that you regularly keep in touch with our consultants at Mount Bonnell Advisors when completing your taxes. We ensure our client files the accurate and updated tax information.