A plethora of businesses are set up in Massachusetts that range from large scale to small scale. While deductions are essential for every business, they become way more significant for small businesses that are trying to keep the tax burdens at a minimum. But, navigating through the business taxes can be pretty stressful and complex at times, which is why it is often suggested to get professional assistance from a certified public accountant in Saugus. Now, let us take a look at some key tax deductions that can help to minimize the overall tax burden.
- Home office deduction
Many people utilize their home space for numerous business purposes. The good news is if a portion of the home is occupied for such purposes, one can deduct expenses related to that space. The primary method allows $5/square foot as deductible for up to 300 square feet.
- Business use of the car
If anyone uses their vehicle for business purposes, it allows them to have deductions either on actual expenditures incurred or go by the standard mileage rate established by the IRS. A comprehensive log of business miles serves as an essential report to support the claim.
- Supplies and equipment
Numerous supplies are ordinary and a necessity for the business, and fortunately, they are entirely deductible. Such supplies include office supplies like pens, postage, and paper, as well as significant purchases such as furniture and computers. When it comes to the purchase of larger equipment, Section 179 deduction gets businesses to deduct the total price on such equipment that qualifies and purchases software.
- Rent
If someone rents a place for official purposes, that rent amount also qualifies for the full deduction, including leasing agreements and leased equipment.
- Utilities
There are numerous utility costs involved, too, including water, internet, and electricity, among others used for business that are also deductible. For the home office, there should be a distinct record that reflects portions primarily used for business.
- Professional services
Fees that are paid to numerous professionals like accountants, consultants, and lawyers who directly provide services to the business are deductible, too.
- Marketing and advertisement
While promoting the product or service of a business, there is a requirement for marketing and advertisement to bring it to the noticeable surface and increase sales. That includes marketing campaigns, advertising, developing a website, and business cards, which are entirely deductible.
Need for a certified public accountant!
A plethora of small business owners consider hiring a CPA as an additional cost. Still, in reality, the amount of benefits they bring to the equation, along with their expertise, proves to be way more rational and appropriate over time because they are very well aware of the basics and complexities of everything related to business finance.