What Are Some Deductions I Might Be Missing?
Business owners sometimes forget to deduct many business expenses. If you work from home for instance, and currently a lot of people do, you can take home-office deductions. A home office expense is calculated either by the number of rooms or by the square footage percentage you use as your office. Let’s say your apartment has four rooms and you use one for business only. One-fourth of your rent, then, would be a home-office expense. As well as one-fourth of your utilities. One-fourth of any home maintenance would be an office expense.
If you go out for a business meeting, it has to be a normal and usual business expense. Stretching it and saying, “I want to go to this fancy restaurant and I’ll mention my business so I’m going to take a tax deduction.” No. But, if you go out for an actual business meeting, now that restaurants are starting to re-open, that would be a usual business expense. You would need to note which client you went to meet with. If you ate lunch in your office, that, unfortunately, would not be a business expense, as you would have to eat lunch anyway. But if you bought lunch for your employees to eat in the office, that would certainly be a business expense.
Interest on business loans and the like should be tracked as a business expense.
Track anything you think might be a business expense and then run it by your CPA at the end of the year. He or she will let you know what you can or cannot deduct.
Feel free to reply and ask me any questions you might have on this subject!
Maya Weinreb | Founder & CEO