If you’re a small business owner, you know just how hard it is to keep your head above water while managing a business—especially during tax season. As a small business owner, you want to make sure you’re filing your taxes correctly (no one wants an audit on their hands), while also making the most of your tax deductions as possible.
That’s why working with a financial advisor and tax professional is so important. The tax professional can help you file your taxes correctly while making sure you’re keeping more of your hard-earned dollars. Today, we’re sharing a list of creative tax deductions for small business owners that will help you make the most of your 2024 tax returns.
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While not everyone loves the process of paying their taxes, most people love being able to reduce their taxable income through tax deductions. And if you’re a small business owner, every dollar counts and every deduction can help you keep more of your hard-earned money in your bank account so you can focus on managing your business.
That’s why working with a tax specialist in tandem with your financial advisor is so important. These two types of professionals can help make sure that even your taxes fit into your larger financial plan. When you’re working with your SageSpring advisor (or SageSpring CPA*), you can expect them to help you get creative when it comes to your small business tax deductions.
Six Creative Tax Deductions For Small Business Owners
Here are some tax deductions that you may want to consider taking advantage of if you’re a small business owner:
1. Business Supplies
Thankfully, business supplies like paper, pens, ink cartridges, paper clips, envelopes, and more are seen as a necessity for running your business. The government allows you to write these expenses off on your taxes each year. Just make sure to keep your receipts!
2. Start-up Expenses
Sometimes, it can be expensive to start a business. When you put your own money into the business, you’re investing it into the future of your business. The government knows that, which is why they allow you to list start-up expenses as a tax deduction over the years through the amortization process. Your financial advisor, accountant, or tax specialist can help you with this process.
3. Home Office or Rental Space
Whether you have a home office or rent office space somewhere else, those expenses can be a tax deduction. If your home office is where you conduct business, you’ll measure the square feet of your office and use that information to calculate your write-off. If you rent office space, keep track of your expenses—that will help you during tax season. On that note, if you’ve purchased furniture to furnish your office, that’s also a tax deduction.
4. Internet and Other Software
Do you have internet for your business? What about computers or other types of software to keep your business running? Those items are also considered tax deductions for small business owners.
5. Business Insurance
If you’ve purchased insurance for your business (smart move), you can use that as a tax write-off. Whether that’s general liability insurance, product liability insurance, or something more specific, make sure to include it as a deduction.
6. Company Vehicles
If you purchase and utilize a company vehicle, you can count this as a write-off. The government has a specific process for depreciating assets (such as company vehicles), so working with your tax specialist can help you feel confident that you’re filing correctly.
This list of creative tax deductions for small business owners is just a small list to help you get started. Work with your SageSpring advisor team to make sure you get the most out of your tax returns this year. Contact a SageSpring Wealth Partner in your area today.
Any opinions are those of the author and not necessarily those of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional.
*The tax advice and/or services of SageSpring CPAs are independent of RJFS.
