Home Based
Business Tax Tips
by: Tara Grant
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 realted
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 bak 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.
10- Computers- If you purchase a new computer for
business use, the cost of the computer may be
claimed. You may also claim depreciation for 3 years
after the computer was purchased. |
