Insurance premiums: Premiums paid to protect your business against loss or theft are deductible business expenses. This includes, but is not limited, to the following:
- Natural disasters like hurricanes, earthquakes and floods
- Business bad debt
- Liability insurance
- Life insurance
- Insurance on vehicles used for business
Self-employed health insurance: Payments made for medical, dental and qualified long-term care insurance for yourself, your spouse and your dependents are deductible business expenses.
Business
startup costs and organizational costs: Costs incurred to get your business up and running are
deductible business expenses. Within the first year, you can deduct up to
$5,000 for startup costs and $5,000 for organizational costs. Any amount of
more than $5,000 can be amortized during a 15-year period.
Bad business debts: Any amounts that you have been unable to collect payment from a customer is considered to be bad debt and is a deductible business expense.
Advertising
and marketing costs:
Expenses incurred to promote your business are deductible business expenses.
This includes, but is not limited to, business cards, flyers, website and fees
paid to companies like Constant Contact to send promotional emails.
Car and truck expenses: If you use your vehicle for business, you can deduct the portion that you use the vehicle for business, no personal use
. Charitable contributions: A business can deduct up to 50 percent of their gross income as charitable contributions. However, be sure to adhere to the following guidelines:
- For contributions of $250 or more, you must obtain a letter from the organization that includes the amount of the gift and whether or not you received any goods or services in exchange for the donation.
- Volunteered services are not deductible; however, you can deduct costs incurred while volunteering like supplies purchased
- Mileage incurred while volunteering is deductible at 14 cents per mile for 2017
- Donations of goods, services or property are deductible
Membership fees: Membership dues paid to the Chamber of Commerce and other professional/trade associations of which you are a member are deductible business expenses.
Franchise, trademark and trade name: Fees paid to purchase a franchise, trademark, trade name, or DBA are tax-deductible business expenses..
Legal and professional fees: Payments made to attorneys, CPAs, financial planners or
other professionals for your business are deductible business expenses.
Tax preparation fees: Fees paid to a tax preparer to prepare your tax return are tax-deductible.
License and permits: Payments for a business license, real estate agent license and other permits required for your trade or business are all tax-deductible business expenses.
Repairs: Minor repairs to your office such as painting and plumbing
leaks are deductible business expenses. However, major repairs that will
increase the value of the property are subject to depreciation for example putting in a brand new roof or a brand new
central air and heating system.
Subscriptions: Subscriptions to magazines and journals that are related
to your business are tax-deductible. Personal magazine subscriptions are not
tax-deductible.
Supplies and materials: Supplies used in your business are tax-deductible. This includes, but is not limited to, the following:
- Paper
- Ink for printer
- Pens, pencils and notepads
- Cleaning supplies
- Books and manuals
- Software
Telephone: Monthly service fees paid for telephone service in a
commercial office space are tax-deductible. If you have a home office, you are
not allowed to deduct the basic telephone service charges and taxes for the
first line in your home. However, any subsequent telephone lines added for
business use are deductible business expenses.
Depreciable assets: Purchases made for furniture, equipment and machinery typically must be depreciated over the number of years they are expected to last.
Payments to 1099 contractors: Payments made to independent contractors that provide goods and services to your business are tax-deductible. This includes but is not limited to payments to bookkeepers, virtual assistants* and web designers.
Home office expense you may be
eligible to deduct a portion of your household expenses based on the percentage
that you use your home for business. This includes, but is not limited to, the
following:
- Utilities
- Real estate taxes
- Insurance
- Deductible mortgage interest
Gifts: You can deduct up to $25per year/per person for gifts that you purchase for people connected to your business: clients; subcontractors; employees. This can include gift card purchases, gift baskets or other items.
Continuing education: You can deduct payments for registration fees and
materials for seminars and courses that you attend as part of continuing
education credits for your trade or business.
Taxes: State and local taxes or taxes paid to a foreign government are deductible on your federal taxes
Bonus!
Child Care: If you have earned income, you may be eligible for the Child & Dependent Care Tax Credit. Some of you have chosen to have home based businesses so you can be home with your children. If your business is such that you decide you can be more productive if someone else is taking care of them while you work and you hire either an in home caregiver or send them to daycare, you may be able to claim this credit.
*your services are deductible to your clients
