If you work for yourself, you may enjoy the numerous benefits that accompany doing so. Of course, the biggest one for most people includes having a more flexible schedule. The personal satisfaction of being your own boss is sure to be high on your list of significant accomplishments as well. The good news for you is there are many tax deductions you can claim since you own a business. Being aware of what these are can be very helpful to you.
Deduction #1: Home office
The square footage of your home office will be considered, and there is a particular formula that is used to determine the precise amount that you can deduct for using this space. Of course, this is typically based on the entire size of your home and your tax preparation specialist will know how to calculate this amount.
Deduction #2: Travel expenses
Do you need to go places for your job? For instance, if you're a contractor and need to travel from one location to another, you will be able to use a certain amount of money per mile to determine precisely what your deduction may be. This figure includes the cost of gas and the wear and tear on your vehicle.
The more miles you travel on a routine basis, the greater this deduction will be.
Deduction #3: Service providers
Many individuals work at home these days and use the Internet to do so. If you have a job that requires you to work online, you can subtract the cost of your Internet connection from the gross amount of your income.
Other services you may require to make a living at home could include things like your cell phone. Just multiply these monthly costs by 12 to get the total annual expense that can be subtracted from your gross income.
Deduction #4: Office equipment
Do you need a new laptop, printer or other supplies that can help keep your business running as it should? If so, all of these costs can be used as a substantial tax deduction for you, and this can work to save you lots of money in the long run.
The benefits of keeping up with the costs of running your business are many because this simply means fewer taxes you will need to pay each year. Take the time to consult with your accountant to get the proper financial advice when it comes to tax season each year.