Tax Savings for Home-Business Owners

 

One of the great benefits of owning your own business as a Fine Choice Food Club Business Partner is that you can save significantly on your taxes! All it takes is a little planning and awareness of each possible deductible expense.

Some things can be 'deducted' in full, others can be 'expensed', and still others can be partially deducted. Below are some examples of expenses for which you should keep records because every receipt and recorded expense can translate into significant savings. And that's JUST LIKE GIVING YOURSELF A RAISE, regardless of how much you earn from your home business this year!

Any items or expenses that are reasonable and necessary in the course of business may be deducted for income tax purposes.  Examples include:
 

  • Supplies

  • Advertising (including leads)

  • Bank charges on business accounts

  • Interest expense on business loans

  • Dues and subscriptions relating to the business

  • Travel for business purposes

  • Business related insurance

  • Business licenses and fees

  • Rent or leases

  • Business telephone and fax lines

  • Wages paid to a spouse or children

 

These items may be expensed for tax purposes in the year purchased
or over the useful life of the item and only to the extent of business usage:

  • Computers and computer equipment
  • Vehicles
  • Office furniture

Household expenses may be deductible to the extent there is an office used in the home exclusively for business.  Examples include:

  • Mortgage interest

  • Property taxes

  • Rent

  • Utilities

      Other benefits of self-employment that are generally not available as a business expense, but are possibly increased deductions elsewhere on an individual tax return

  • Possible 100% deduction of health insurance premiums

  • Possible increased deduction for retirement plan contributions

     

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Disclaimer: The above represents only the more common items used in a home based business.  All expenses should be documented for the business purpose of that expense.  Limitations may apply on the above items. This information does not constitute legal advice; see your tax advisor for details.