Tax Deductions Most Business Owners Overlook

By May 23, 2016Blog

Are you missing out on tax deductions?

Just think right now how you’d feel to pay less tax, it’s like music to your ears.

Especially when you think you’ve expensed everything you thought you could. It’s simple, the more tax deductions you legitimately have the less you’ll pay in taxes on your profits.

What if I told you, you might be missing out on tax deductions? Your brother’s best friend’s sister is a CPA and you heard through the grapevine all the things you can deduct right? That’s not the best way to handle your financial situation. It’s actually a terrible way. So, it’s time you educate yourself properly so you can move forward with confidence and obviously tax savings (More Moolah!) 

That’s not just more money around April of next year when you file, you can take advantage of more money this very month.

Tax Deductions

Let’s begin this section with one of the most common business owner tax questions:

Can I Write This Off?

To get started, let’s hear what the IRS has to say in order for a business to write off an expense. The IRS states that in order to write off a business expense it needs to be both ordinary and necessary.

  • An ordinary expense is one that is common and accepted in your trade and business.
  • A necessary expense is one that is helpful and appropriate for your trade and business.

Deduct More This Year With This

So now we’ve understood what qualifies for tax deductions, we can get into more specifics and make sure you’re expensing everything possible and not making any mistakes. One of the mindsets you need to consider is this, if you are spending a dollar, is that “related to my business?” If there is a business purpose to the expense then you would claim it as a business deduction.

So, think about the industry you are in. If you’re a gym owner, or a chiropractor, or an insurance agent, you’ll have specific expenses for your industry. Remember, if you can justify that it meets the IRS standards of being ordinary and necessary, then make sure you claim it.

So you might buy supplements, gym clothes, shoes, as a gym owner. You may get your nails done to look nice for your clients as a real estate agent. Even books you buy to help educate you. (if you have a specific expense you’re curious about, comment below, and we’ll answer yes or no for you.)

We have worked with so many taxpayers and been involved in thousands of situations talking about their tax deductions. 9 times out of 10 they’ve missed something they could deduct.

Now, after you read this, don’t think you can start writing everything off. But I wanted to get you thinking. Instead of going through the motions, think “is this expense related to my business?” You’ll be surprised and happy when you realize and are taking all the proper deductions.

There are two expenses you can never deduct.

This section is simple and if you need further clarification, download the list below and it will fully cover in detail more on these. Those expenses you can’t claim would be personal groceries, and your mortgage/rent amount.

Keeping Track

Once you’ve purchased something and deemed it worthy of being a deduction make sure it’s classified in the correct way.  There are several good apps to use and we even have a list of ones you can look over, Deductr is another great resource to consider, but whichever you choose, make sure you monitor them regularly to see where you are and classify them all properly.

A Full List of Tax Deductions + Tax Strategies

We do have a full list of business tax deductions for you to download if you want further understanding on what you can write off. It even goes in depth with Mileage, Travel, Meals and Entertainment, and many more. What you need to make sure of is that you are taking advantage of your situation. Business owners are in a wonderful situation to stick it to the IRS. We just wish more had the knowledge/confidence to do so.

You can now experience what it’s like to have more!

To download the list of business deductions along with details on specific tax deductions/tax strategies for business owners click below, then download:

Yes, I Want That!

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