Darlees.com

There is nothing worse than preparing Income Taxes & finding that there were many deductions we did not keep track of. Not keeping track of deductions can be very costly come tax time. It’s very important to keep good records all year round.

For every dollar you do not deduct, you could be paying up to 35% back to Uncle Sam. If the dollar has been spent, taxes should not have to be paid on it… Think of the productivity of your business if you could put 35% of your income back into your business rather than in the hands of politicians. Right. What kind of advertising campaign could you do with 35% extra cash flow every month. With a little organization & planning this can be possible.

Most business owners remember to take the big obvious deductions such as cost of goods sold, materials, tools, supplies, & employee expenses. But often times it’s the small seemingly insignificant deductions that can make or break a company. Lone Peak Business Solutions has the 10 most commonly missed business deductions.

1. Advertising – Business cards, newspaper ads, information packets you hand out, free samples, flyers, product testing, videos & CD’s.

2. Children – Money paid to children for helping with such things as delivering flyers, product, stuffing envelopes, cleaning office & car, etc.

3. Dues & Subscriptions – Dues to professional organizations & magazines that have to do with your trade or business.

4. Educational Expense – Classes or seminars that you take to improve your business.

5. Gifts – Gifts to clients & associates.

6. Laundry & Cleaning – This includes uniforms & Protective clothing & also your clothing when you’re out of town.

7. Travel – Hotels, airfare, cab fare, parking, cleaning while away from home, trip log.

8. Home Office – A home office must be a separate room in your home to do business & accounting. Part of your living room or bedroom will not count. A percentage of utility Bills, home owners insurance, property tax, mortgage interest, refinance fees, repairs & maintenance, cleaning supplies, office decor, etc. are deductible. You find out the percentage by dividing the square  footage of the office by the square  footage of the entire house.

9. Mileage or Vehicle – There’re two ways to take a vehicle expense. One is to take the mileage you use when picking up product, supplies, office supplies, meetings, handing out advertising or business cards, meals & entertaining clients, etc. The other way is to take the expense of using the vehicle: fuel, parts, mechanics, oil changes, etc. Along with taking expenses, you can also depreciate the vehicle.

10. Telephone – Cell phone, long distance calls on home phone, extra phone lines into home for business, fax or Internet.

Items such as paper clips, bank charges, credit card charges & home office expense seem small & unimportant at the time, but multiply those little things over a year or two & then multiply it times 35% & it can add up to quite a bit of money that should be in your pocket rather than in the government’s pocket.

Along with keeping track of expenses it’s important to evaluate your income & expenses on at least a quarterly basis. There is more. This allows you to determine if too much is being spent any one place. It allows you to determine if all the deductions that can be are being claimed. It allows you to determine how to better increase sales & decrease costs.

Christopher Anderson wants to share his success as a business owner with others who desire to own their own business. He also believes that the economy is stronger with more business owners, & as a result, He is focused on helping business owners succeed. http://www.lonepeakbusiness.com

You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.