If you have a phone number that has a mix of business and personal calls, you may still take a deduction for the portion relating to business usage. The water, power, trash, and telephone bills at your office are all 100 percent deductible as regular business expenses. Track your total auto expenses as well as business mileage so your tax advisor can help you to calculate the maximum deduction on your tax return. You may use the method that results in a larger deduction on your tax return. There are two ways to calculate vehicle deductions: standard mileage rate or actual expenses (such as gas, repairs, and maintenance). You can deduct contributions you make to your employees' SEP, SIMPLE, 401(k), and other qualified plans. Benefits like health plans, adoption assistance, educational assistance, and life insurance for your employees are generally tax deductible. Employee pay. You can deduct any amounts you give your employees for compensation in cash, property, or services.Inventory (cost of goods sold). Businesses that sell or manufacture products can deduct the cost of goods sold.Checklist of tax deductions for small businesses Use the following checklist as a guide to ensure you capture all your business expenses and minimize your tax bill. Since deducting expenses from your income reduces your tax bill, it's important to make sure you have captured everything you are legally entitled to. It is never too late to get some tax-saving strategies together. Why? Because business owners often do not know what deductions they can take. However, more often than not, business owners do not take full advantage of all the tax deductions for small business they are legally entitled to. It is true that business owners get to enjoy some massive tax savings as compared to employees.
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