At Coastal Business Services, we understand just how important your small business is to you. You started this business from the ground up and poured a lot of sweat and hard work into make it the best business possible. But like many other small business owners, tax season is a time of cringing and feeling like Uncle Sam is taking advantage of you. That tax bill often takes new business owners by surprise.
With the right tax preparation and looking for all the deductions that are possible for your small business, Coastal Business Services can actually help you to lower your tax bill and may even help you to get a refund at the end of the year. Here are some of the small business tax deductions available to help your business stay afloat during tax season.
Auto Expenses
Depending on the type of business you run, Coastal Business Services can help you get a deduction on your auto expenses. You may be able to deduct tolls, parking fees, and mileage for using your car for business. Most taxpayers will use the standard mileage rate deduction since this will be easier to claim and doesn’t require as much paperwork. But if you travel a lot for your job, you may want to calculate the actual expenses because this will give you a larger deduction. For this latter option, you will need to keep track of the exact mileage of all trips, the reason for each trip, the starting points and destination of each trip, and even how much you spent on gas. The more information you have, the easier it is to claim this deduction.
Equipment and Supplies for the Business
As a small business owner, you will find that there are many supplies and equipment needed to help your business grow strong and that these will get expensive. When you choose the right accountant to help with these expenses, you can deduct some of them and save even more on your tax bill. The professionals at Coastal Business Services can also help you to figure out whether purchasing a new piece of equipment would make the best sense for your business and whether you would be able to get a deduction for this new addition.
Legal and Professional Expenses
Association dues and any legal expenses are deductible for your small business. If you are including these in your startup costs, you will need to spread them out over 60 months. In addition, when it comes to association fees, you will not be able to deduct any amounts that are given for lobbying or political contributions. Since many associations for your business will use funds for political reasons, they will often disclose the amount for your dues that is included for this purpose.
Start Up and Expansion Expenses
It is possible to deduct your expenses associated with starting up the business or expanding. But the right steps need to be taken to ensure that you get your full refund. You will first need to decide whether you will deduct these expenses all in your first year or if you will amortize them over time. If you choose the latter option, you must use a paper election attached to your tax return stating your intentions. Without this paper, you will not be able to deduct these expenses until you sell the business.
Coastal Business Services can help you through this process. We can discuss whether it is best to deduct all the expenses in the first year or if amortizing is the best choice. If you decide to amortize your expenses, our professionals will help you fill out and attach the right forms so you don’t miss out on your deductions.
Advertising Expenses
When you are looking for a tax preparer for your small business tax deductions, make sure to find someone who knows how to deal with advertising and gift expenses. While it is possible to write many of these off in your taxes, you have to be careful. The IRS has some specific rules regarding what can be deducted in the category of advertising with your business.
Home Office
If you use a home office to run your business, Coastal Business Services can help you figure out what all can be deducted from your tax return. There are many options here. Any software or publications you need to keep the business running, supplies, utilities, Internet, and more can be deducted. Our professionals will take a look over your receipts and help you to determine which expenses can qualify for your home office deduction.
Travel and Entertainment Expenses
Any travel and entertainment expenses that you incur for your small business. To receive this small business tax deductions, you will need to keep excellent records to prove the exact costs of your entertainment expenses. They also need to be related to your business; you won’t be able to write off a family vacation to Florida just to save money. In addition, you will only be able to deduct 50 percent of your entertainment costs.
Bad Debts
If one of your clients does not pay you, it is sometimes possible to claim a deduction on this debt. You must claim this debt as income at some point to get the deduction. For example, if you billed the client in 2014 and then claimed this bill as part of your income, you could deduct this as a bad debt in 2015 when the client never pays you. Without claiming the debt as income, it is not possible to get this deduction.
When you are looking for a tax preparer who can help you with all your tax needs, look no further than the experience of Dennis O’Brien from Coastal Business Services, LLC. Located in Farmingdale, NJ, O’Brien has been helping individuals and businesses get the tax breaks they need for years. Give us a call today at 732-996-0608 to get started on your taxes today!
Dennis O'Brien