Tax Deductions That Small Businesses Commonly Miss
Keeping up with the tax code is hard enough if it’s your job, but when you’re running a small business, you probably don’t have a lot of time to track down the best small business tax deductions in Union City, NJ. However, there are plenty of deductions that small business owners can take, which will lessen their tax liability and help them increase their profits year after year. When you run a small business, you get to subtract the “ordinary and necessary” expenses that are associated with keeping your company running.
If you want to make sure that you get all the common tax deductions for small businesses in Union City, NJ, call the professionals at Kedean’s Generation. We make it our job to make sure you get every deduction for which you qualify. The tax deadline has been pushed back to July 15, so there’s still plenty of time to have your taxes reviewed by a professional.
Here are some of the most commonly missed deductions:
- Wages and payroll taxes: Employee wages and payroll taxes are deductions from your business taxes, but did you know that paying yourself a salary or wage can also reduce your tax liability? It helps avoid the self-employment tax on your personal taxes.
- Health insurance: If you’re self-employed, you can deduct your entire family’s health insurance costs from your personal taxes (depending on the type of business entity you own).
- Retirement plan contributions: Depending on whether you have an IRA, 401(k) or other type of retirement plan, any contribution you make can allow you to reap tax benefits later on down the line. Plus, it will encourage you to save more from retirement—a win-win all around!
- Education and training: Training and continuing education costs—like conference, trade show and workshop fees, among others—are deductible from your business taxes, as long as they’re directly related to the business and helped you expand your knowledge.
- Marketing: Marketing tends to be a significant expense for business owners, but these costs are also deductible. Everything from the money you spend on advertising to hosting a website and hiring your own marketing consultant can be a deduction.
- Travel and entertainment: Client and employee travel is still deductible, although the 2018 changes to the tax code made entertainment deductions significantly harder to qualify for. Still, if you’re paying to travel to conferences, trade shows and more, you can deduct those expenses.
- Taxes, charitable contributions and fees: Bank and credit card fees, state and local taxes and any charitable contributions you make all count against your tax liability.
- Startup costs: If you incurred startup costs before your business’ launch, you can claim up to $5,000 of those costs on your business taxes.
- Home offices: Home offices are renowned for being an audit magnet, but if you run your business out of your home, you are eligible to deduct certain costs. Essentially, you need to have a dedicated office space that is exclusively used for business purposes.
Need a tax professional to help you get the most small business tax deductions possible in Union City, NJ? Call Kedean’s Generation today.
Categorised in: Tax Preparation