While tax season is a stressful time for most small businesses, a certified public accountant can help you make the most out of this season. Believe it or not, many owners won’t take advantage of some key tax deductions for small businesses. Of course, this will only mean a higher tax payment to start the new year.
If you want to avoid paying large tax fees every year, an accountant can help steer you in the right direction. Their diligence will find you any possible route when trying to save money during tax season. They’ll also be able to do a lot more for your business!
What Is a Tax Deduction?
When you go out and buy something from a store, there’s a good chance you have to pay a “sales tax,” unless you’re in Delaware, Montana, Oregon, or New Hampshire. Believe it or not, you also have to pay a similar tax on any income you make — this is true for both individuals and small businesses.
If you’re used to working for someone else, then you probably see this deducted from each paycheck. This process is different for small businesses. Most will have an option for paying their taxes at the beginning of the year or periodically throughout the year, but everyone will owe something when their taxes get filed.
Of course, the amount you owe will depend on how much money your small business makes in that calendar year. The percentage that you are taxed will increase the higher your income is, but that’s where tax deductions come in.
A tax deduction is typically an expense that a small business is faced with throughout the year that is required to keep your small business functioning. Each deduction will take away taxable income, meaning you won’t have to pay as much when you file. The more you deduct, the better off you’ll be.
What Can Be Deducted?
When it comes to tax deductions for small business, there are a wide variety of deductions you can take. Having a certified public accountant will not only make sure you are deducting the right things so you don’t get in trouble with the IRS, but they will also reveal some tax deductions you didn’t know about before.
Let’s take a look at some of the most common tax deductions for small business:
- Home office supplies
- Advertising and marketing
- Business meals
- Travel expenses
- Moving expenses
- Legal fees
- Telephone and internet
- Software and technology investments
- Business insurance
- Bank fees for your company account
While these are just a few of the tax deductions most small businesses will take advantage of, there are so many more to be discovered — you just need a quality certified public accountant by your side!
If you’re ready to get the most out of this tax season, contact PB Scala, CPA today. I assist small businesses with a large variety of accounting and bookkeeping services and can’t wait to do the same for you!