Tax Deductions for your Small Business
One small perk of going into business for yourself is the tax deductions you can make for business expenses. However, if you decide to take advantage of this offer, you will need a clear understanding of which expenses are deductible and which are not. When you are trying to make a new company profitable, the last thing you need is an unexpected tax audit.
The best way to avoid potential complications down the road is to discuss your plan with an informed Des Moines business lawyer. At the offices of LaMarca Law Group, P.C., we put our years of experience to work for each of our clients. To discuss your plans for the future, call us at 1-(877) 327-2600.
Business and Capital Expenses
According to IRS guidelines, there are two basic kinds of expenses for people who run their own companies: business and capital. A business expense is an inherent part of conducting business, such as renting an office and hiring employees. A capital expense is a specific asset that will last for at least one year, such as a piece of equipment for your office.
Business expenses are generally tax deductible; in other words, you can subtract these costs from your reported gross income when filing your taxes, thereby not paying taxes for them. Capital expenses are usually not deductible, but you can still save on them when tax season arrives. By using a process known as depreciation, you can regain some of the money you spent of these assets every year that you expect to use them.
Common expenses that may be eligible for deduction or depreciation include:
- The portion of your mortgage, utilities, etc that go towards your home office
- Business-related travel expenses (only 50% of the cost of meals may be deducted, however)
- Your employees’ salaries and most benefits
Our Des Moines business deduction attorneys can help you learn more about which of your business costs may be deductible or depreciable.
Running a company is expensive enough; you need to take advantage of any money-saving opportunities available. To learn more about tax deductions and other useful strategies, contact Des Moines business deduction lawyers LaMarca Law Group, P.C. at 1-(877) 327-2600.