tax write offs for small business owners

It has never been easier to deduct the cost of maintaining a home office. As of 2015, the IRS permits a deduction of $5,000 in start-up costs and $5,000 in organizational costs incurred during the first year of operations. Fortunately, you can write off some of the expense of launching your business as tax deductions. From buying supplies and equipment to leasing office space and funding advertising campaigns, the costs add up fairly quickly. Getting a new business up and running can put a serious pinch in your wallet.

For the 2015 tax year, the standard rate is 57.5 cents per business mile driven. Parking fees and tolls are also tax deductible.

Standard mileage rate – in this instance, business owners can deduct a fixed amount for each mile driven.

Business owners opting for this method can also deduct depreciation expenses on the vehicle in question.

Actual expense method – the deductible costs are calculated based on actual spend on gas, oil, repairs, tires and insurance.

This tax deduction can be executed in two ways. If you use your personal automobile for business purposes, you can recover some of the money you spend on gas and vehicle maintenance. Not sure what’s admissible? Take a look at five of the most valuable deductions small business owners can cash in on. Tax deductions can lower your bill by hundreds or even thousands of dollars, if you can properly account for the relevant expenses. Strategic Tax Deductions for Small Business OwnersĮvery penny counts when you’re running a small business your tax liability is no different.

Tax write offs for small business owners