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Tax Deductions
As a small business owner, you want to keep more of your hard-earned money. Fortunately, there are plenty of small business tax deductions that could help you save more of your profits and grow your business. While business taxes can be complicated, we’ve compiled the best ways to make paying your federal, state, and local taxes less painful.
Featured Articles
Tax Write Offs for the Self-Employed
If you are new to being self-employed, you may be unaware of all of the deductions that you may be eligible to take. While this article simply cannot cover all of them, there are some very important ones that you should not overlook.
Updated Mar 1, 2022
Tax Deductions for Your Home Business
It’s good to arm yourself with the information you need in your tax return about which qualifying expenses are allowed for business use of your home. In this guide, we’ll go into detail about which items in your home can qualify for tax write-offs so that you can focus on putting any profits you earn back into growing your small business.
Updated Feb 2, 2022
Tax Hacks for Small Business Owners
One of the best ways to save money and meet your obligations is by paying more attention to your taxes. With a few simple tax hacks, you can enhance your small business in more ways than one.
Updated Mar 12, 2022
All Articles
Tax-Deductible Startup Expenses
Starting a business is costly, but some of your startup expenses are tax deductible. Make sure you don’t miss out on any tax savings by finding out which of those expenses you can write off.
Updated Apr 8, 2022
Business or Hobby: Deductibility of Expenses
If you have a hobby that produces income, your hobby income is taxable. But what about hobby expenses and losses? Whether or not you can deduct hobby expenses and losses depends on whether you pass the IRS hobby vs. business test. Here’s what you need to know to avoid getting caught by the hobby trap.
Updated May 3, 2022
Qualified Business Income Deduction
The qualified business income (QBI) deduction can save owners of businesses whose income passes through to their personal returns up to 20% on their taxes. Find out how this pass-through deduction works below.
Updated Dec 26, 2021
Claiming the Standard Mileage Deduction
Taking the standard mileage deduction when you use your car for business can yield big savings on your taxes. Find out what the current IRS mileage rate is and what the IRS’s rules are for taking this deduction.
Updated May 10, 2022
7 Tax Deductions for the Self-Employed
What tax deductions can the self-employed take? Here are seven types of expenses the self-employed, home businesses, and sole proprietors can deduct.
Updated Mar 23, 2022
How Do Self-Employment Tax Deductions Work?
Have you become self-employed and begun working from home? If so, you need to be aware of all your legal tax deductions so you can avoid overpaying your income taxes. Here’s how tax deductions work.
Updated May 4, 2022
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FAQs
Though not a comprehensive list, each of these business expenses are tax deductible:
- Advertising and promotion
- Business-related meals
- Business insurance
- Interest and fees on your business bank account
- Mileage and depreciation on your car when used for business
- Home office
- Legal and professional fees
- Rent for office or storefront space
- Salaries and benefits
- Telephone and internet
- Business Travel
Talk with a tax professional to make sure you maximize all of your possible deductions.
A variety of tax credits, grants, and refunds are available to businesses for going green. Many states offer tax deductions for implementing energy-efficient programs or updates to your business. Individual cities also offer incentives for using energy-efficient appliances, solar, and more. Research your state and local energy tax incentive policies to see what programs are available to you.
All small business deductions are available to sole proprietorships, as well as C-corps, S-corps, partnerships, and LLCs. Different rules may apply to each type of business entity. Talk with your tax professional to find out what specifically applies to you.
The Self Employment income tax rate is 15.3% and is split into two parts: 12.4% goes to social security and 2.9% goes to Medicare. Business owners, independent contractors, and freelancers must pay the Self Employment tax if their earnings are above $400 for the year. This is in addition to the regular income tax.
Some business insurance policies can be tax write-offs for your small business. These may include property insurance, liability coverage, malpractice insurance, workers’ compensation insurance, vehicle insurance, and employee life insurance policies that are provided by the business. Additionally, the cost of the business owner’s health insurance and business continuation insurance are tax deductible.
Tax Information and Resources
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