Our Ask A CPA feature answers to questions frequently asked to CPAs. As a CPA, I love to answer these for our readers. Got a question? Email me at corporate@thecorporatesister.com!
Q: I’m self-employed, and am not sure which deductions I can take on my tax return. Can you help?
A: If you’re self-employed these days, you’re in excellent company. Roughly 55 million Americans are as well… And when it comes to tax season and making the most out of your business expenses, there are many deductions you can take advantage of:
- Your Home Office: All those equipment expenses you incur, not to mention the very space you use in your home to conduct your business operations, are all deductible. The IRS allows you to deduct part of your rent or mortgage associated with the space you use as your home office. Additionally, you’re also allowed to write off a portion of your home utilities and insurance related to your home office.
- Work Expenses: Various costs directly related to your business can also be deducted, including office equipment such as computers and printers, printing paper, business cards, and even ink and toner… Even expenses such as website hosting and domain name, or online payroll software costs, can be written off of your taxable income.
- Software and Hardware: If you bought a desktop computer, tablet, or laptop for business use, it may very well be deductible. The same goes for software purchases or updates.
- Education and Business Travel: Did you attend a conference or class during the year? Did you have to travel for it, and/or stay at a hotel or arrange an alternative accommodation? Keep in mind that business travel, as well as training and educational expenses, may be deductible. Don’t forget to include car rentals, parking costs, shuttles, and taxis to your list of deductible expenses as well…
As a self-employed individual, you should take every opportunity to leverage your expenses and revenues to grow your business. Keep abreast of updates and changes in tax rules that can benefit your business in the long run.
Got other questions? Add them to the comments, or email me at corporate@thecorporatesister.com!
To Your Success,
The Corporate Sis.
