The Top Tax Deductions For Small Businesses

Tax time is always a stressful time, particularly for small business owners. One thing that can help to relieve some of the tax pressure is knowing what tax deductions are available for small business owners and understanding whether or not one qualifies to claim these deductions. Small business owners are eligible for a number of tax deductions and unfortunately, many have no idea of the deductions that they are allowed to claim.

Car and truck expenses are one that many small business owners forget to claim. This deduction includes the costs of buying or operating a vehicle for business purposes. It is important to keep records of any purchases related to the operation of a company vehicle such as gas purchases, new tires, oil changes and other expenses.

Many small businesses, particularly home businesses, do not have the burden of wages for employees. Those that do however, are eligible for a tax deduction for these payments. Any payments made to employees, whether full or part time, are deductible on business taxes. This also includes any contract labor that is paid through the business.

Other expenses that can be deducted include renting office space, the cost of purchasing property for the business and any utilities that are used for the operation of that business. In the case of home businesses, rent or mortgage and utilities are limited to a percentage of use. Any office supplies and computer or other equipment is also tax deductible for businesses as is travel expenses and state and local taxes. Repairs for property or office equipment can be deducted, as well. Finally, many business owners neglect to take a portion of their insurance policy costs, which are tax deductible. The cost of the business owner’s policy as well as any malpractice or specialty insurance required by a business is tax deductible, for up to about half of the paid premiums. Small business owners who are unsure of precisely what they can deduct on their taxes should speak with a qualified accountant prior to filing to ensure that they are receiving all of the tax breaks that they are entitled to receive.

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