Home Based Business Tax Deductions

Running a home based business reaps many wonderful tax deductions that other businesses some times may not claim. Unfortunately to many small business owners end up paying the government taxes every year because they are unaware or several small business deductions that are available.

Most of the time any expenses that are related to your business can be added as a deduction on your taxes. If you do not pay taxes through out the year, deductions can help you from paying a large amount of taxes each year and can also adjust earned income. Try to avoid paying large amounts of taxes or owning any money by keeping track of simple things!

Each business is a bit different so be sure to mention these ideas to your tax advisor or accountant to see if your business can qualify for these deductions.

1- If you join any business or purchase into any franchise, the expenses such as kits, or franchise fees may be claimed as a deductions.

2- Business Supplies. Be sure to save all receipts for any supplies you purchase for your business use. Computer paper, business cards, pens, catalogs, or any items you purchase and use for your business.

3- Advertising- Most advertising can be claimed on your taxes. Keep all receipts for any newspaper ad's you may run, or any advertising you do online. Advertising is a business expense and in most cases can be written off.

4- Items Given Away- Keep a list of any items you may give away, and the costs of these items. Most freebies may also be written off.

5- Phone bills and internet access- If you have a phone line for business use or have the internet in your home or office for business use, save all receipts for each bill paid. These items are business expenses and may also be written off.

6- An in home office- If you have an office in your home, make sure to let your tax advisor know. Using a room in your home as an office can also be added on taxes.

7- Long distance calls- If you make any long distance calls that are related to your business, make sure you keep all phone bills showing the calls and the amounts charged. If these calls are related to your work, the cost of the calls may also be written off in most cases.

8- Returned Checks and Bank Fees. If you incur and bounced checks from customers and can not collect on them, those amounts may be deducted, along with any fees you were charged from your bank. Be sure to keep the returned check, the letter from your bank and your bank statement to show the fee you were charged.

9- Postage- All postage costs paid by you or shipping fees may be claimed. Keep receipts for all shipping supplies, and postage.

10- Computers- If you purchase a new computer for business use, the cost of the computer may be claimed. You may also claim depreciation for 3 years after the computer was purchased.

About The Author

This article may be republished with the resources box included and links must be hyperlinked.

Tara Grant, owner of http://www.awomansresource.com and http://www.designbytara.com. Tara is a warm-hearted entrepreneur, mother of 2 small children and an avid networker in the wahm and parenting communities!

[email protected]

In The News:

California’s Tax-the-Rich Boomerang  The Wall Street Journal
A Tax Trap Many Fund Investors Fall Into  The Wall Street Journal

The Tax Man Cometh... To Search

You're at your office, or home, and the doorbell rings... Read More

Back To School ? Educators Deduct School Expenses

As teachers and students head back to school following a... Read More

Highlights of IRS List of 2005 Tax Scams

Each year, the IRS lists various scams taxpayers get caught... Read More

Seven Key Tax Deductions for the Self Employed

As a sole proprietor, it's wise to familiarize yourself with... Read More

Navigating The Internet Sales Tax Laws

QUESTION: I have been contacted by my local city... Read More

Tax Help Secret: Avoiding the Entreprenuers Curse

Your days as an entrepreneur and businessperson are consumed with... Read More

Tax Time Tune Up

Excerpted from the new book, "How to Do Space Age... Read More

Insider Guides to IRS Audits!

Ever wish that, as a business owner, you knew exactly... Read More

Tax Trap #3 -- IRS Penalties, Interest and Love Letters

As a small business owner or self-employed person, one of... Read More

Where to Find Tax Breaks for Your Home Based Business

April 15th looms in front of most people every year... Read More

Understanding Marketing Tax Deductions

Marketing is a necessary expense in running practically any business... Read More

Another Tax Loophole

Just image, you are a small manufacturing company, business has... Read More

Get Uncle Sam To Pay $36,000 For Your Childs Education!

Let's assume that you would like to begin saving for... Read More

How Home-Based Businesses Can Avoid Giving Uncle Sam More than His Share

How Home-Based Businesses Can Avoid Giving Uncle Sam... Read More

Surprising Truths About Tax Preparers

Choosing the right tax preparer for your business is a... Read More

Your IRS Tax Appeal Rights

Are you in the middle of a disagreement with the... Read More

1031 Exchange Rules and Requirements

Following is a reproduction of the IRS's rules and requirements... Read More

Uncle Sam is Ready...Are You? Organizing Tips for Tax Time

Anyone who is closely related to an accountant knows that... Read More

About Income Taxes; Tidbits

1812The first attempt to impose an income tax on America... Read More

Furnishing Evidence in E-Tax Compliance

Self-assessment relies on taxpayers voluntarily meeting their tax obligations. This... Read More

Alas! In E-Commerce Taxland

In trying to comply with tax laws for your e-business,... Read More

Amending Procedural Laws for Collection of E-taxation

The electronic transaction ordinance defines the certificated copies in which... Read More

Save Money on Taxes - Let Uncle Sam Pay for Your Fun!

"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More

IRS Offer-in-Compromise, Hype or Hope?

"Settle for Pennies on the Dollar! IRS debts settled for... Read More

Small Businesses Filing Amended Federal Tax Returns to Recover Money

Small Businesses Filing Amended Federal Tax Returns to... Read More