February 18, 2008

Common Tax Deductions

One of the ways that can help offset expensive costs to small businesses is common tax deductions. The government realizes that small business can help the economy grow and are an extremely important foundation to this country. In order to make sure that new businesses form and innovation continues, the government entitles entrepreneurs common tax deductions that can help take the bite out of lots of expenses. Here are some tips on common tax deductions.

Make sure that when you start a small business you talk to a tax accountant or verse yourself in what is considered a common tax deduction for small businesses. Many people think that there are many deductions that actually do not exist, causing them to spend thousands of dollars with no hope of deducting the cost on their taxes.

One of the many common tax deductions are legitimate business expenses. If you have costs that are paid out in order to do business such as special software, leasing a delivery truck or office computers, you can deduct these costs off of your taxes

Another common tax deduction for small business is to deduct a percentage of your home mortgage or rent due to a home office. Be careful on this tax deduction. Lots of times the IRS will flag you, making sure that you are using that space solely for business purposes.

If you drive to a sales meeting or to visit customers solely for business, you can also deduct mileage on your car. Usually the rate is around 44.5 cents per mile, but it does change frequently. If you are looking for common tax deductions for your small business, take a look at the above tips.