It’s that time of year again, and tax deadlines are just around the corner. If you’re like most small businesses, you probably planned to take care of your taxes with plenty of time to spare so you could take advantage of your returns early on in the year. But generally, this isn’t the way things actually work out – most of us put the paperwork off until the last minute and then have to scramble to get our returns in just under the wire. Unfortunately, this means that you might miss out on some of the big deductions you can take as a small business.
Legitimate deductions aren’t always that straightforward – in fact, some of them are just downright strange and funky. Here are some super weird tax deductions for small businesses that are totally legit and you might want to consider this year.
If you have a large client base, chances are you’re aware that you can deduct things like dinners and taxi fare when you’re entertaining them or drumming up new business. But the IRS understands that sometimes a small business needs to spend money to make money – and this can include occasional extravagant expenses like tickets to a great concert or sporting event, spectacular galas or even deep sea fishing, for example. As long as business discussions are conducted and considered in the cost of doing business, you can deduct expensive things like this that are a part of impressing your clients to build a relationship.
A Trip to Bermuda
Any business convention held in Bermuda can be written off as a small business tax deduction. You don’t even need to provide evidence that there was a particular reason to host the event there – it just has to be a legitimate event. The same holds true for Barbados, Costa Rica, Dominica, Grenada, Honduras, Jamaica, Saint Lucia, Trinidad and Tobago, Canada, Mexico and all U.S. possessions. If you have to plan a convention, why not double it up with a trip to the tropics?
If you have kids, you can take childcare as a small business tax deduction if you are doing charity work for a non-profit. In other words, if you are paying someone to babysit your kids while you work a job that gives no pay, you might be able to write it off. It’s a good excuse to do charitable work – which can be a great boon for networking and your business.
You can deduct the cost of all business calls that you make. Each month, take a look at your phone bill and circle the business-related calls. Total them up and keep a copy, and at the end of the year, tally them up and deduct the full amount. You can’t deduct regular fees and charges unless you have a dedicated business line.
Medical expenses are usually a pretty standard tax deduction. But if the stresses of running a small business have landed you with high cholesterol, a few extra pounds, high blood pressure or other health problems, any remedy to fix them could be deductible. If your doctor has told you that they are concerned, then this could include gym memberships, massages, acupuncture and more – just as long as your doctor signs off on it.
If you have to drive for your business, keep documentation of all your trips. You’ll want to record the date, mileage, tolls, parking costs and the purpose of your trip. Then you can total the mileage and add in the excess costs to calculate the total. Multiply the mileage by $0.54 for your 2016 deduction.
If you have a pet pooch, you could claim him or her as a guard dog needed to protect your business or home business. You can deduct at least a portion of the cost of caring for the animal while they protect your property and belongings.
You’re already deducting your office space or home office, but you can also deduct any office furniture that you’ve purchased this year. Deduct 100 percent of the cost if you’ve purchased it this year. You can deduct the depreciated expense over the next seven years after you’ve purchased it, too.
Do you need to subscribe to industry mags or publications for your job? Some businesses even need a daily newspaper, such as the New York Times or Washington Post, to stay abreast of current events for their business. These are all deductible expenses if they are in some way related to your work. Deduct the total costs as a full deduction in the year spent.
Relocation costs for a new job are pretty common small business tax deductions. But did you know that you can also include the cost of moving your pets as a tax-deductible expense? Cats, dogs, birds, snakes – whoever your animal friends are, you can tally up the excess costs for purchasing crates, food, pet-friendly hotel rooms, etc. and tack that onto your deductions.
Don't miss out on these small business tax deductions when you're filing your returns this year!
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