Even many of the most liberal small business owners, especially those people running things from a home office, tend to be overly conservative when it comes to taking advantage of every tax deduction they are legally entitled to. The overriding thrust of this particular brand of twisted conservatism is the looming specter of an IRS audit. Well, here’s some really useful information that even the folks at Fox News probably can’t spin into bad: IRS audits under Pres. Obama dropped to an eight year low and the trend downward continues. So take full advantage of these small business tax deductions.
Simplified Home Office Deduction for 2014
You may no longer need a guide to help you through the home office tax deduction labyrinth. The Minotaur lurking inside waiting to pounce on you (by which I mean the IRS auditor hungrily looking for a mistake in your math) can be slayed by taking advantage of the simple $5 per square home office tax deduction for your small business or sole proprietorship. There is a limitation on square footage: 300 square feet for a home office, but that still comes out to a $1500 deduction and if your office is really only 275 square feet, well…it’s up to you.
Deducting Expenses for Business Use of Leased or Rented Vehicles
If your small business requires enough driving to guide you toward the very detail-oriented choice of adding up your actual vehicle expenses rather than taking the much easier “mileage method” then there is one very important thing to keep in mind. Even when that driving requires the use of renting or leasing a car, it still counts as tax deductible expenses for the business use of a vehicle. Not only should keep still keep track of mileage, but you can also add in the cost of leasing or renting the car to your small business tax deductions.
Deducting Petty Cash Fund Disbursements
Does your small business keep a petty cash fund? Is that petty cash included in your accounting books? Then don’t forget to keep a record of those disbursements made for business purposes. When IRS filing times rolls around, you can then include payments made from the petty cash fund on your list of tax deductions just as you would any expense for your small business paid from a banking account or credit card.
Business Education Deductions
Ever pick up a guide to running a small business at the book store? Or attend a seminar on integrated marketing? Did you know that you can deduct those and any other expenses you made that furthers your own business education? The definition of “business education” is both remarkably rigid and fantastically flexible. Your education must relate specifically to the business your company is conducting right this now, meaning you cannot deduct anything related to learning about what your company might be doing next year or a decade from now. That said, you may very well be able to make a justifiable case for taking a business education tax deduction on anything from the cost of a class at Harvard to the cost of a Caribbean cruise to learn how to better market your business to the vacation industry.