Posted on: 8 September 2016
You don't have to own a large corporation to take advantage of government-approved tax deductions each year. Small businesses can deduct a wide range of expenses, from driving costs to office supplies. Read on to learn about potential tax deductions for your company.
If you have a small office, it might be difficult to find enough space to schedule on-site meetings with clients. As a result, you or your employees may rack up mileage in a company vehicle while traveling to different meeting sites around the area. You may also incur expenses for parking if you can't find a public lot, or you might have to pay a toll fee if you cross a bridge.
Business-related automotive expenses are eligible for a tax break if you meet the guidelines established by the government. As of 2016, the IRS offers businesses $0.54 per mile. A representative from a tax planning service can explain what your business has to do to receive reimbursement or request a deduction for mileage, tolls, and parking.
On average, an office employee prints, copies, or jots down notes on an astonishing 10,000 sheets of paper per year. Even if your employees use less paper than the statistic reflects, your business may still dedicate a significant portion of its budget to office supplies. Luckily, you can deduct the cost of certain office supplies at tax time if you own a small business.
Possible supply deductions include the following:
- Office equipment, such as printers, fax machines, or computers
- Writing utensils
- File folders
- Ink cartridges
Keep all of the receipts for your office supplies throughout the year and present them to a tax expert. This makes it easy to figure out which expenses are deductible when you file a return.
If you have less than 25 employees who work full-time at your office, your company may qualify for a health insurance credit. Household employers, some farmers, and tax-exempt businesses also qualify for this deduction. The IRS does not let businesses claim this credit more than two consecutive years in a row, and you may have to pay at least 50% of each employee's qualifying health plan to receive the credit. Talk to someone from a reputable tax preparation company to make sure your company meets the requirements for a deduction.
Tax preparation for business owners, even small business owners, doesn't have to be stressful. Reduce your out-of-pocket expenses—and possibly even qualify for a refund from the state or federal government—by adding qualifying deductions to your tax return. A tax specialist can help you determine whether your company qualifies for the money-saving breaks listed above.Share