When you’re running your own business, whether it’s a restaurant or a retail store, you want to make the most out of every penny that you spend. To give yourself the best chance at long-term success, tax time is a major opportunity to take advantage of. There may be dozens of tax write offs, subsidies, or deductions that you qualify for, that can save you a lot of money, and help keep you afloat year to year.
While there are several tax deductions that are specific to certain industries, many are open to small businesses of all sorts. A qualified Fort Collins small business CPA can help you understand your unique tax responsibilities, as well as find all the write offs or deductions you can claim on your filing each year. Here are some of the most popular tax deductions for small businesses:
Rent prices for commercial areas in Colorado can be high, and any way to save some money can be helpful. The rent you pay for your business, whether it’s a storefront or a spot in an office building, is tax-deductible. Make sure you keep track of these expenses every month or quarter, however you pay them.
Many businesses, especially in the skilled trades, use company vehicles for work-related jobs. You are able to claim these deductions, using either the IRS standard mileage rate (as of 2019, it was 0.58 cents per mile), or you can manually add up all of your vehicle-related expenses. Depending on your situation, one of these choices may be better for you.
3. Marketing materials
If you printed new business cards, bought a billboard space, or ran a TV ad campaign last year, you can deduct these expenses on your taxes this year. Advertising and marketing costs, essentially anything that you’ve used to promote yourself or bring in new customers, are fully deductible.
4. Qualified business income
For most small businesses, income tax deductions can be a lifesaver. Under recent laws, most small businesses will be able to deduct 20% of their income from their taxes! There are some exceptions to this, however, including higher-income earners (earn more than $157,500/year, and deductions may phase out), so make sure to talk with an experienced Fort Collins CPA about your eligibility.
Running your own company is hard work, and you deserve every break that you can get. Maximize your tax write offs and deductions this year! Reach out to us at S.J. Wick & Associates for your customized small business tax plan.