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home office tax issues

This past year was the first year that I was fortunate enough to work from my home. Working from my home has been a wonderful change for both personal and professional reasons. The only thing that caused a slight issue was the tax filing changes that I had to endure. The office in my home was now considered a tax deduction. I had to get some help learning how to deduct the things that are allowed on my federal taxes. If you are new to working from home and have a home office, this blog can help you learn what you need to know before tax time rolls around.

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3 Tax Tips For Your Small Business

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Filing taxes for your small business can cause a lot of headaches if you don't have a background in accounting. If you have no real experience with keeping good financial records and do not have a strong mathematical background, it can cost you a lot of money if the government decides to audit your business. Sitting down with a professional accountant is the best way to get your financial affairs in order and get you the maximum return on your taxes. Here are a couple great tips that can help you get the most for your small business.

  1. If you operate your small business out of your house, then you are entitled to write off a portion of your rent or mortgage. You will need to know exactly the size of the space that is allotted inside the home for the business and how it compares to the living space. You could also be entitled to claim expenses that you would need to keep the house running, such as heat and electricity. Basically, anything that you would spend renting an office space would be equal to the space that you are using inside your home as a tax write-off.
  2. Travel expenses and any expenses that you incur for an automobile that is used for the business can be claimed. This would include gas, but you would need to keep all of the receipts and keep track of the mileage that is used for the business versus personal use. Car maintenance and repairs are necessary and can be claimed on your taxes as well for things like oil changes, new tires, or brake replacements. Keep track of all the expenses in a spreadsheet and tally them up monthly broken up by what each expense was.
  3. Any business related conferences or hotel accommodations can be claimed if they are necessary to help grow the business. Keep a tally of the tickets that are purchased or the hotel bills that are incurred because you are away from your home base in an effort to spread awareness about the business. An accountant will also sit down with you to go over expenses and they will also be able to let you know if you can claim a small portion of your meal expenses when out on the road on business.

A professional accountant is necessary for going over all the various tax loopholes that they can use to the advantage of your business. Visit Hy Appelbaum CPA for more information.

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29 January 2016