Cottage Industry Tax Deductions
Running a home based business reaps many wonderful tax deductions
that other businesses some times may not claim. Unfortunately to many
small business owners end up paying the government taxes every year
because they are unaware or several small business deductions that are
available.
Most of the time any expenses that are related to your
business can be added as a deduction on your taxes. If you do not pay
taxes through out the year, deductions can help you from paying a large
amount of taxes each year and can also adjust earned income. Try to
avoid paying large amounts of taxes or owning any money by keeping
track of simple things!
Each business is a bit different so be
sure to mention these ideas to your tax advisor or accountant to see if
your business can qualify for these deductions.
1- If you join
any business or purchase into any franchise, the expenses such as kits,
or franchise fees may be claimed as a deductions.
2- Business
Supplies. Be sure to save all receipts for any supplies you purchase
for your business use. Computer paper, business cards, pens, catalogs,
or any items you purchase and use for your business.
3-
Advertising- Most advertising can be claimed on your taxes. Keep all
receipts for any newspaper ad’s you may run, or any advertising you do
online. Advertising is a business expense and in most cases can be
written off.
4- Items Given Away- Keep a list of any items you
may give away, and the costs of these items. Most freebies may also be
written off.
5- Phone bills and internet access- If you have a
phone line for business use or have the internet in your home or office
for business use, save all receipts for each bill paid. These items are
business expenses and may also be written off.
6- An in home
office- If you have an office in your home, make sure to let your tax
advisor know. Using a room in your home as an office can also be added
on taxes.
7- Long distance calls- If you make any long distance
calls that are related to your business, make sure you keep all phone
bills showing the calls and the amounts charged. If these calls are
related to your work, the cost of the calls may also be written off in
most cases.
8- Returned Checks and Bank Fees. If you incur and
bounced checks from customers and can not collect on them, those
amounts may be deducted, along with any fees you were charged from your
bank. Be sure to keep the returned check, the letter from your bank and
your bank statement to show the fee you were charged.
9- Postage- All postage costs paid by you or shipping fees may be claimed. Keep receipts for all shipping supplies, and postage.
Contact The Tax Club for more details
