Summer is here which means it is that time of year where things start to pick up and get busy with your small business. Although the summertime frenzy is exciting and lucrative, it is easy to forget about taxes during this time. Did you know you can write off most of your business-related costs? Well, today we are going to look at massive itemized deductions for 2018 you need to know.
Massive Itemized Deductions for 2018 You Need To Know
Car & Truck Expenses
As a small business owner, you typically use a car, light truck or van to help maintain your business. You can deduct the cost of operating this vehicle for business purposes if you keep records to prove business usage.
Note: The IRS standard mileage rate for 2018 is 54.5 cents per mile.
Home Office Deduction
Do you work from home with an office space dedicated to running your business? If so, then you can count that as a deduction as long as the home office meets IRS requirements.
If your kids use your office as a playroom you cannot count that as a deduction (Lol). Placing your laptop on a table or laying on the couch working won’t cut it either. However, an entire room does not have to be devoted to your home office; part of the room will work.
Note: Don’t even try to claim your whole house unless you want someone from the IRS knocking on your door sooner rather than later.
Office Space Rental
If you need to find a larger business or office space to accommodate your growing business or staff, you can deduct the difference in cost for renting the space.
The interest on your mortgage loan can also be deducted!
Salaries and Wages
The payments you make to employees, which include salaries, wages, commissions, bonuses, and taxable fringe benefits, can be deducted by small businesses.
Note: Payments made to sole proprietors, partners, and LLC members are not considered wages and are not deductible.
When it comes to insurance, there are several types that you can deduct. Flood insurance, malpractice coverage, cyber liability coverage, business continuation insurance, and even the cost of your business owner’s policy can be deducted.
Did you know that you could deduct the cost of utilities for running your business? Yep, things such as your electricity bill, A/C bill, phone bill, internet, and more can be deducted.
Note: If you have a home office, a family landline cannot be deducted. However, the 2nd line for business calls only can be. You can also deduct the percentage of calls that are used for business calls from your mobile phone bill.
Although we live in a tech-savvy world, there are just some office supplies that you need in your office space. Materials such as pens, pads, sticky notes, etc., can be deducted. You can also deduct cleaning supplies that are used to keep your space nice and clean.
Furniture upgrades and software subscriptions can also be deducted so that you can give your team the comfortability and tools they need to produce results.
Growing your business is one of your main goals. Take advantage of great advertising because ordinary advertising costs are fully deductible!
Do you need to travel to handle business-related concerns? Deduct those expensive travel costs for airfare, train tickets, and lodging.
Meals and entertainment costs can also be deducted, but don’t splurge too much; only 50% of these costs can be deducted.
No matter how much money you spend on an equipment purchase, things break and need maintenance at some point. If equipment for your business needs to be repaired, you can deduct these costs.
Enjoy summer and all of the perks that come with the season! Make sure to keep a detailed record of your business-related receipts and take advantage of these small business itemized deductions for 2018.
TaxBandits has you covered when it’s time to handle tax filings for your business. Whether it’s 1099, W-2, 941, or an extension form, TaxBandits has everything you need to file on behalf of your business using one account.
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