Skip to main content

Small Business Tax Tips for Self Employed...

As a Self Employed Business Owner...there are several tax breaks that you can take advantage of....here are 3 of the most popular tax breaks

1. Home Office deduction: If you have a home office there are several expenses that you may write off on your tax return. If you have an office inside your home and that space is dedicated solely to your business then you may write off a percentage of your mortgage or rent payment, gas, light and phone bill. You may also write of any other services that you use for that office space. You will need to measure the office space by square feet, subtract the office space from the total square footage of your home. This will determine what the actual percentage of space that is used for your home office. Then you can deduct that portion from your home bills i.e the mortgage, gas, phone payments and etc.

Example: total sq ft of home is 1200sq ft your office space is 300sq ft

2. Health Insurance Premiums: If you are self employed and paid your own health coverage you can deduct the cost in full of the total premiums paid. You may also start a health savings account and deduct the amounts that were contributed to the account.

3. Supplies: You have expenses for your business, so the IRS allows you to deduct the cost of those expenses like the purchase of a new computer, printer, paper, pens, or any other legitimate expenses for your business. It is very important to keep a record of all receipts and purchases that are specific for your business in the event you are audited you have a paper trail of your expenses that you claim are for business purposes.

Comments

Post a Comment

Popular posts from this blog

Finance Tip: Open a separate bank account for your business. If ever audited gathering paperwork will be a breeze. Plus you want keep your personal and business expenses separate. The Tax Daughter Patrice L Stewart www.patricestewart.com
1 comment
Read more
Choosing the Correct Filing Status It’s important to use the right filing status when you file your tax return. The status you choose can affect the amount of tax you owe for the year. It may even determine if you must file a tax return. Keep in mind that your marital status on Dec. 31 is your status for the whole year. Sometimes more than one filing status may apply to you. If that happens, choose the one that allows you to pay the least amount of tax. 1. Single. This status  normally applies if you aren’t married. It applies if you are divorced or legally separated under state law. 2. Married Filing Jointly. If you’re married, you and your spouse can file a joint tax return. If your spouse died in 2015, you can often file a joint return for that year. 3. Married Filing Separately. A married couple can choose to file two separate tax returns. This may benefit you if it results in less tax owed than if you file a joint tax return. You may want to prepare your taxes both w...
Post a Comment
Read more

IRS provides Top Six Tax Tips for the Self-Employed

Top Six Tax Tips for the Self-Employed When you are self-employed, it typically means you work for yourself, as an independent contractor, or own your own business. Here are six key points the IRS would like you to know about self-employment and self-employment taxes: 1. Self-employment income can include pay that you receive for part-time work you do out of your home. This could include income you earn in addition to your regular job. 2. Self-employed individuals file a Schedule C, Profit or Loss from Business, or Schedule C-EZ, Net Profit from Business, with their Form 1040. 3. If you are self-employed, you generally have to pay self-employment tax as well as income tax. Self-employment tax includes Social Security and Medicare taxes. You figure this tax using Schedule SE, Self-Employment Tax. 4. If you are self-employed you may have to make estimated tax payments. People typically make estimated tax payments to pay taxes on income that is not subject to withholding. If you...
Post a Comment
Read more