In some businesses, you are going to need to travel some in order to conduct the business. Very few times will you be able to just stay in one place and make the business run. But all this traveling can quickly add up in costs, and when you are trying to keep all the other parts of your business running in a smooth manner, from your employees to all the inventory and beyond, it may seem like an impossible task that you won’t be able to keep up with.
If your business is one that needs to include a lot of traveling in order to keep things running, there are some deductions that you will be able to use in order to save some money. These are meant to encourage your business to grow without costing you a lot of money in the first place. From reducing the amount of gas that you have to spend on your own while traveling and even paying for some of the business lunches and entertainment that you have to spend. When you are ready to save some money on the different business expenses that you need to pay each year, make sure to contact a tax professional to help you out.
Vehicle Expenses
If you are traveling for business, your car can take quite a beating. There are a lot of miles you can travel and over time you may have to pay for some of the repairs that your vehicle will need. Some of the expenses that you have to pay to keep your vehicle in good working order will be deductible at the end of the year.
There are two deductions that you can choose with this option. The first one is a simple deduction. With this one, you will simply figure out how many miles you traveled for the year and multiply with the standard deduction rate that is set out by the IRS for the year. Put that number into the deduction, and you will be set. Your tax professional will be able to figure this number out with you.
The second option is a bit more complex but it could help to save you a bit more money in the end. It allows you to find out the exact amount that you spent on gas and traveling, as well as maintenance on your vehicle, so you are able to deduct them from the tax return. You will need to do a good job at record keeping through the year to get this one to work, but it can save you some money.
Dinner and Entertainment
This one can get a little bit tricky so make sure that you are discussing this with your tax professional before getting started. In some cases, you may need to take your clients out to a nice meal or some other place in order to discuss business. Or you may have a business meeting that is going to include food and some other entertainment, such as a Christmas party or some other event that is meant for the business. In some of these cases, you may be able to deduct the expense at tax time.
You will need to be careful with this expense though. You can’t go on a big trip with your coworker and then count it as a business expense. But if you go have dinner with a client and discuss going into business with them or make a sale, you can count this as a business expense. It often comes down to what occurs at the event. If it is business in nature, and you can prove so, you will often be able to deduct it as a business expense. Make sure to keep all of the receipts of these dinners and entertainment until the end of the year so your tax professional is able to go through them and get you the best deduction possible.
Hotel Accommodations
Sometimes your business is going to draw you out of town for a few days and nights and you need somewhere to sleep. You probably do not want to just sit in the back of your car and hope you are refreshed enough to make your customers impressed the next day. So you will often need to pay some money to stay at a hotel to get a good nights’ sleep and feel a bit more refreshed in the morning.
If you do have to pay for a hotel stay, make sure that you are keeping all of the receipts. You will be able to get some of the money back as business expenses at the end of the year. While you don’t have to stay in the worst hotel you can find, keep in mind there are some limits so staying at resorts and other fancy places each time is going to get expensive as the IRS will not cover these for you.
Hiring a tax professional can make all the difference during your tax season. It can help you to get the most out of your deductions and will save you a lot of money in the process. When you are ready to get started on your tax return and to see just how much you can save on your business expenses, make sure to contact our offices to find the right tax professional for your needs.
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