Almost 90% of small business owners overpay the IRS each year – do you want to belong to this category? We guess not! There are a number of tax deductions for a small business to take advantage of, and help save them money. Here are the top 10:
1. Auto expenses: If you use your car for business, or your business owns its own vehicle, you can deduct some of the costs of usage. If your automobile is used for both business and pleasure, only the work related usage of the vehicle entitles the business to a tax deduction. That means you must keep track of how often you use the vehicle for business, and add it all up at the end of the year.
2. Education expenses: Expense incurred on education, related to your current business, trade or occupation is another cost that can count towards tax deductions for a small business. Of course, there are strict guidelines to be followed - the expense must be to maintain or improve skills required in your present career and must be undertaken during the course of your job.
3. Legal and professional fees: Fees paid to lawyers, tax professionals or consultants generally can be deducted in the year in which they are incurred.
4. Business entertaining: If you pick up the tab for entertaining present or prospective customers, you may deduct 50% of the cost, while calculating taxes. This should be directly related to or associated with the business, and the entertainment must take place immediately before or after a business discussion. Remember to write down the purpose of the event on the receipt or bill.
5. Travel: Travel costs also count towards tax deductions for a small business. If you travel on business, you can deduct most of the expenses including the cost of air fare, car rentals, taxis, lodging, meals, shipping of business materials, telephone calls, faxes and tips. But if you take your family along, remember, you can only deduct your own expenses.
6. New equipment: Some small businesses can write off the full cost of assets in the year in which they are bought. You can deduct up to $108,000 for a single piece of equipment or from the cost of various items as long as the equipment is placed in service before the end of the year.
7. Interest on loans: The interest and carrying charges on business loans are fully tax-deductible. Be sure to keep good records showing that the money was really put into your business.
8. Moving expenses: If you move because of your business or job, you may be able to deduct certain moving costs that would otherwise be non-deductible personal living expenses.
9. Charitable contributions: Here’s an expense that serves two good purposes. Charitable contributions are allowed as tax deductions for a small business. When your business makes a donation, claim a deduction on the tax return.
10. Advertising: The cost of advertising your goods or services is also deductible as a current expense.
Finally, keep an eye open for the latest on tax deductions for a small business, since laws do undergo changes. Even more important is to ensure that your financial records are maintained well.
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Why the rush to write? After reading this article, my gut feeling was that Hans and Teri Rotter were the victims of a conspiratorial plot to oust them. Mr. Rotter was in the hospital for a serious heart condition. Rather than postpone the board meeting to allow him the opportunity to explain his actions, the members of the Alpine Board decided to go ahead and hold the meeting with only Mrs. Rotter present. Rather than sit through all the accusations against her husband, Mrs. Rotter left the board meeting before it ended. The Rotter?s daughter and son-in-law were installed as the new managers of Alpine that night. Immediately after the meeting ended, all the locks to Alpine Village were changed. It was, for all intents and purposes, a nice and tidy ?take over.? Was not the writer of this article, Mr. Green, aware of the above circumstances? In Mr. Green?s article he stated that the Rotters were not available for comment. This being the case, does Mr. Green think he is ethically justified in writing a smear piece on two individuals who for over 40 years have been stalwart leaders in the community, are well-loved and admired by everyone whose lives they?ve touched? Why the rush to write?.to print such a ?one-sided? article? Could not Mr. Green have waited a few days until Mr. Rotter returned home from the hospital and given time to digest the events that had just transpired before making any statements or comments? After all, the Rotters were the ?face of Alpine Village? and deserved better treatment and consideration before this rush-to-judgment article was written. As far as I?m concerned, Alpine Village will not be the same without Hans and Teri Rotter. They were one of the main reasons why people frequented Alpine from far and near. The ever gracious ?Aunty Teri? as she is affectionately called, has a place in all our hearts. This couple is stellar. Their sense of ethics and integrity are irreproachable. They were an extremely effective and trustworthy team that managed Alpine for 40 years resulting in increased profits for Alpine. They were truly a force for good. In closing, I encourage Mr. Green and the Daily Breeze to right the wrong of this article by allowing the Rotters an opportunity to tell their side of the story and to print an article that is both fair and balanced so that we, the readers, will have the ?whole? story.Marion Hannemann, Torrance
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