It is commonly known that there are large numbers of tips for deducting taxes from income that you have to pay to the IRS, in order to reduce the amount of the sum. However, not everyone knows that there are lots of ways for incorporating deductions into tax returns for your business.
It is hard to believe, but precisely small businesses make a substantial influence on the economy, therefore, there are a huge number of tax deductions for small business’ support. That being said, most business owners do not want to spend time trying to figure out whether they are required for different types of deductions or not. Today, we are going to guide you through the most effective, but little-known deductions available for your business.
Retirement Saving Deductions
Did you know that you can deduct some aspects of your retirement savings by applying for the Simplified Pension Plan, the Saving Incentive Match Plan for Employees or through contribution to a personal plan? Thus, small business owners are provided with an opportunity to deduct retirement plan contribution for employees in case the business owner is a sole proprietor. Contact the Prestige Auditors team, and we will explain to you all the rules and requirements for applying to these deductions.
Self-Employed Health Insurance
This type of deduction provides you with an opportunity to deduct health insurance and medical expenses. Let’s agree that one of the most expensive purchases that a person can make, is life insurance. However, several business owners are able to deduct these bills from their taxes, along with Medicare premiums. In order to qualify for this deduction, you should first net your profit. One of the main benefits is that you can deduct all the costs of premiums of health insurance. At the same time, you can deduct other medical costs such as prescription medication, or visits to specialists.
Promotion and Advertisements
If you are a small business owner, you can easily deduct all the costs concerning your company’s promotion. As a rule, this expense involves all the costs on advertising and promotion, including ads in newspapers, magazines, television, radio spots or somewhere else.
If you use a car or truck in your business, you can deduct all the costs. However, keep in mind that only partial deductions are available if you also use a vehicle for your personal transportation. Try to collect all the records of the mileage, gas, and other payments regarding your car in order to simplify this process in the future.
In the process of filing tax forms, one of the most vital parts is cooperating with a tax lawyer who will help you out. Thus, you can be sure that all the paperwork is valid and filed in a proper way. It will help you reduce the possibilities of audits or any other issues with the IRS.