13 Smart Tax Write-Offs You Could Take Advantage Of
Thirteen smart entrepreneurs from YEC Young Entrepreneurs Council have saved some money by getting deductions for things they pay for regularly.
We're talking books, parking fees and even event-specific clothing. Things you would never have thought to deduct from your taxes.
Scan this list to see what you can claim and how much you can save on taxes this year.
1. Health Insurance Premiums
If you pay for your own health insurance, you can deduct the premiums from your adjusted gross income. This can really add up over a year and especially over several years. Of course, there are requirements that need to be met so be sure to talk with your accountant before taking any action. – Alex Miller, PosiRank LLC
Online courses, books, certifications, workshops, training and conferences can all be deductible for your business. I have a small education stipend set aside every year for me and my employees. This is a great way to increase your knowledge and a great perk for employees. – Vanessa Van Edwards, Science of People
3. Travel Expenses
Mileage to and from meetings and business-related activities adds up -- so do tolls, parking fees and gas. All of these can be documented easily if you are willing to take the time to do it. It might seem petty at first, but watch how much it adds up to over the course of a full year. The key is to stay up on it. Scan your receipts daily as soon as you get back to the office. – Jonathan Long, Market Domination Media
4. Self-Employed 401K
While it's technically not a tax write-off, contributing to a self-employed 401(K) plan can reduce your taxable income by up to $53,000. Contribution limits for 2015 allow for salary deferrals of up to $18,000 and profit sharing contributions of up to 25 percent of your compensation or an annual maximum of $53,000. These pre-tax contributions can significantly reduce your taxable income. – Brett Farmiloe, Markitors
5. International Sales
If your value added is over 50 percent domestically, and you export $1M or more, you can set up an IC-DISC and save taxes on your exports. – Wei-Shin Lai, M.D., AcousticSheep LLC
6. Association Membership Fees
Often, entrepreneurs forget that it is important to network with others in the same/similar industries. Industry and trade associations are important to network and stay abreast of latest trends. While most of them have membership fees, these fees can be used towards a write-off. It's a win-win! – Tamara Nall, The Leading Niche
Any clothing that has to be purchased for a specific event or is uniquely required to accommodate a client can be written off. This includes company swag for a conference, a suite for a panel and a formal gown rental for an industry banquet. Any clothing expenditure that is needed to market your company, yourself or your client is a legitimate business expense. – Faithe Parker, Marbaloo Marketing
8. Hospitality Expenses
It’s often the little things that people forget to write off, either out of laziness or because they think that it won’t add up to anything. Coffee for clients, buying the team dinner after a long day’s work -- these little things add up. It’s not just the new computers and major business expenses that you have to worry about during tax time. It’s all the little pieces as well. – Matt Doyle, Excel Builders
I am a huge believer of giving back to the community -- not only with money but time. In my eyes, what better way than giving money toward something beneficial to the community which also counts as a tax write-off? Even taking it a step further you can start your own philanthropy to offer other businesses the chance to donate and use it as a write-off. – Marc Devisse, Tri-Town Construction
You can write off technology, including your cell phone plan, so long as you're using it for business purposes. Also, the home office deduction is a nice one if you have a dedicated work space at home. – Brian David Crane, Caller Smart Inc.
11. Cost of Tax Prep Fees
Hands down, failing to deduct the cost of tax preparation; this is money right out of your pocket! We see this on 90 percent of the returns we process. Businesses can deduct these fees on their corporate returns, and individuals can deduct the fees on Schedule A. Of course, they have to itemize on their 1040 for this to work. – Marjorie Adams, Fourlane
12. Real Estate Ownership Deductions
Many entrepreneurs often overlook the benefits of owning their office/retail or commercial space versus renting them. If you're looking to build a sustainable company that is going to be around for a while, then being an owner-operator might be for you. Taking a few hours to meet with a real estate tax professional never hurt anybody. – Mikhail Zabezhinsky, OceanTech
This is true especially around the holiday season. Most of your employees have gone above and beyond for the company and for you. Why not reward your top-performing employees with a nice end of the year bonus check. This will in return lower the bottom line and soften your tax burden while simultaneously putting a huge smile on the face of your employees. I bet they will be roaring to hit the new year with a bang. – Engelo Rumora, Ohio Cashflow