Top 10 Tax Deductions for Small Business

Top 10 Tax Deductions for Small Business

With the end of 2015 upon us, now is a good time for business owners to be checking on what they can legally claim as business deductions when filing their 2015 returns next spring. Here are the top 10 tax deductions for small businesses:

1. Auto expenses. If you use your personal car for business, or if your business owns a vehicle, you can claim expenses in one of two ways: actual expense (keep good records) or standard mileage rate (57.5 cents per mile in 2015).
2. Operating expenses. Advertising, utilities, postage, office supplies – everything you use in running your business can be deducted as a current business expense. If you started a business in 2015, you can only deduct $5,000 for the first year – anything over that must be deducted in equal amounts over the next 15 years.
3. Legal and professional fees. You can deduct any fees paid to attorneys, tax professionals or consultants as well as the purchase price of any business books. If the work done by your attorney or accountant covers multiple years, you must spread out the deduction over the life of the benefit.
4. Bad debt. If you sell a product, you can deduct the cost of goods that you sold but were not paid for – if you’re in a service business, you cannot get a deduction for any time you spent on a client that you were not paid for.
5. Entertainment. You can deduct half the cost of entertaining a client or prospect if business was discussed, or if the entertainment occurs immediately before or after a business function.
6. Travel. Plane fare, airport parking, taxis, mileage, lodging, meals, shipping business materials, telephone calls, faxes, tips, etc. – all are deductible if the purpose of your trip was business.
7. Interest. If you use a business credit card to finance purchases for the business, you can deduct the interest and carrying charges.
8. New equipment. In 2015, you can deduct only up to $25,000 of the cost of new equipment or other business assets. However, thanks to Congress, next year you will be able to fully deduct the price of equipment and software, up to $500,000. That has been made permanent for future years.
9. Software. You can deduct 100 percent of the cost of computer software placed in service between January 1, 2003 and December 31, 2014. When the software comes with a computer, it is treated as part of the hardware purchase and can be depreciated over five years.
10. Taxes. What’s deductible: sales tax on items bought for the business, excise and fuel taxes, employer’s share of employment taxes, real estate tax on business property. What’s not deductible: federal tax paid on business income.

Business owners seeking legal protection for their business interests should seek a qualified, competent advisor for assistance.   Contact one of the experienced Florida business attorneys at Jurado & Farshchian, P.L., at (305) 921-0440, or email us at info@jflawfirm.com.

 Share

The post Top 10 Tax Deductions for Small Business appeared first on Jurado & Farshchian, P.L. Business Lawyer, Real Estate Lawyer, Immigration Lawyer.