The costs of running a small business can add up quickly. One of the upsides of being a small business owner is the ability to deduct several business expenses from your federal taxes. This can relieve part of the financial burden of owning a small business.
Now that tax season has kicked off, many business owners are likely preparing their taxes and wondering which business expenses they can deduct. Some expenses only count as partial deductions, but others can be deducted dollar for dollar.
Fully deductible expenses
The Internal Revenue Service specifies that any “ordinary and necessary” businesses expenses are fully tax deductible. This definition refers to any expenses that are essential for doing business and are frequently incurred by other small business owners. Some examples of ordinary and necessary expenses include:
Partially deductible expenses
There are some business expenses that you can’t fully claim on your tax returns. It is only possible to deduct a percentage of their cost. Some of these expenses are:
Preparing your business taxes
As a small business owner, you have a lot on your plate as it is. Filing business taxes can be incredibly convoluted, and it may not be wise to attempt it on your own. Businesses owners who do their own taxes aren’t aware of the full array of deductions available to them. Instead, many business owners choose to consult an attorney who has experience in business and tax law. The right attorney can help business owners write off as many businesses expenses as possible and maximize their deductions.
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