It is that time of year again. You guessed it, it is time to do your taxes. Every year I look forward to this, am I the only one? Not to see how much my return is, but to see how much income I made for myself in the previous year.
A couple years ago, my old boss told me to make a goal list. It had to included short and long term goals. One of my goals was to get in a higher tax bracket. Since then I have increased my income by ten thousand dollars. I don’t think that’s too shabby for someone like myself. Although, my income has gone up I’m not done working towards my goal.
Every year I sit down to go through papers for my tax return, like most of you should. I like to do my own taxes. My business is accounting hasn’t become too complex for me to manage and if you do your taxes yourself, you are saving your business more money on something you can do yourself. Keep in mind I had a small business and no employees. I do deal with vendors and subcontractors.
Let’s get to the tax stuff shall we?
Travel- Any fuel that you purchase for business trips, hotel, or if you use your car for business you can write off the mileage. I would opt for receipts for everything you pay for that is a business expense. So when you are at the gas pump, yes I want that receipt, along with keeping track of how many miles you have driven for business. This isn’t just for traveling out of town. If you are at home and have to run to Walmart to get printer paper for your business, tally those miles. I find it easier to keep a writing pad in the car so when you reach your destination you can just write it down along with the date and what the miles are for. Don’t forget to keep a pen in your car, too.
There is also several mileage tracking apps you can download. If you use QuickBooks for self-employed, the app has a setting where you can track your mileage. you just have to turn on your location.
Meals-Work related meals purchase are tax write offs as well. You can deduct up for fifty percent of the bill. When doing this though you need to write who the meal was with and why. Say if you had a meeting and you opted to cover the bill, tax write off. Just write who was there and why you met. Super easy!
Supplies- Any supplies you need for your business is a tax write off. Make sure to keep your receipts. (I can’t say this enough. Repeat after me. Keep your receipts.) Every business is different when it comes to supplies. If you are a beauty blogger, all your make up that you purchase is a tax write off. Maybe you have a mobile car detailing company, all those fancy car waxes and soaps and towels are tax write offs. Just be sure to keep track of your expenses.
Home Office-Do you office out of your home? Well, there’s a tax deduction for that to! For this write off though, you will have to measure your workspace and determine how much percentage of your home you use for business work. As well as your utility bills. The percent of your home can be the percentage deducted from your utility bills that goes towards your business. This can be your electric bill, phone bill, internet bill, or if you have a business that uses the television for work then add the cable bill to this list too!
These are just a few items that I make sure every year to keep up with for my biggest tax deduction. There are more out there, this is just to get you a head start in the right direction. Didn’t do any of this last year? Now, you have an idea on what to do this year to make next years tax season a breeze.
Do you stress about doing your taxes?