Being in business for your self is a very liberating
experience and can provide you many advantages over someone who is employed.
One of the benefits you have is claiming deductions when filing your taxes.
Running a business can incur a lot of expenses and the government recognizes
this. As a result, you will find that you have a wide option of self employed tax deductionsthat you
can qualify for. If you are unsure of what you are able to deduct, the
following are examples of some of the many deductions you can file that will
save you money during tax time.
The first of the self employed tax deductions that you can
claim are the payments you make to cover your health and dental insurance. If
you pay the premiums for a spouse or other dependents in your family then you
can claim these as well. Educational costs relating to your business can also
be deducted. If you use your car for work you might be able to deduct a portion
of the mileage and if something happens to your car, repairs are something you
can claim. Other deductions you should claim are any retirement and pension
plans you contribute to.
If an expense is related to the functioning of your
business, chances are you can claim it as a deduction. Some of these self
employed tax deductions include the rent you pay for a home office, a phone or
fax line that you've set up for business purposes, Internet, business-related
entertainment and travel costs you may incur for work. You can also claim
capital gains and any dividends you may receive. Even if there is a trade
publication that you have a subscription to, you will be able to include this
in your deductions. If you're ever unsure if something can be considered a
deduction, save the invoice or receipt and check with your accountant.
When claiming self employed tax deductions, you are in the
drivers seat. By consulting a tax professional you will find that there are
many more deductions you can take advantage of that will save you big time when
it's time to do your taxes. Whatever you claim, however will have to be backed
up with proof. Be sure to keep all your receipts and document everything. The
more thorough you are in your documentation, the less likely you will be
audited. And if on the off chance you do get audited, by keeping and detailed
and accurate records, you will surely survive the process with few problems.
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