Tax Deductions for the Small Business Owner

If you are a small business owner, there are many tax deductions that you might be surprised to hear about that you can claim. We will cover just a few of them in the following paragraphs.

The number one deduction that you can claim is your commercial space, ie, the area that you work from. This can be an area of your home if you work from home, if you paint for a living this could include the vehicle that you use to transport your supplies to and from the work site, if you own a shop, it could be rent. For a home business, calculate the amount of space that your workarea takes up. Then, charge yourself rent for that area. This rent is tax deductible.

Another deduction that you can claim for your business are the supplies that are used. For the painting business, the supplies that are claimable are items such as paintbrushes, paint, ladders, vehicle, the different chemicals that are used, cloths... anything that you use to help your business survive.

Home business owners can claim their computer, printer paper, a portion of your house or apartment (rent), printer ink, a portion of your telephone bill can even be tax deductible if you use the telephone for your business. Electricity used to power the computer can also be claimed as an expense. To maximize your deduction potential, see a tax professional.

You can also claim future purchases as tax deductions. In running a painting business, you might want to expand and open an actual shop to house your business. In this case, you could use the office desk and chairs as well as chairs in the waiting area. All furniture purchases for use in your office can be writtten off as business expenses.

Some other deductions that can also be written off include some health insurance, auto insurance, flood insurance (if you are in a flood prone area such as Fargo, ND or New Oreans, LA)... basically, any type of insurance.

If you are going to be claiming things as business expenses, it is VITALLY important that you keep immaculate records. You will need proof that you bought the items, when you bought them and where you bought them.

Record keeping is a year long process... not only to be done at tax time. Your business may depend on it.