Common Tax Write-Offs for Business Owners

Common Tax Write-Offs for Business OwnersOwning a small business has many advantages, not the least of which is the fact that business ownership can result in a decreased tax burden. Depending on the type of organization you have set up, you may be able to take advantage of one or more of the following common deductions for business owners:

  • Business Entertaining: You may be able to deduct 50% of the cost of business entertaining if it is either immediately before or after a business meeting, or if the entertainment was directly related to the business, or if business was discussed at the meeting.
  • Bad Debts: Depending on what type of business you are in, you may be able to write-off debts that have gone unpaid. Generally, service-oriented debts are not eligible and good-related debts are.
  •  Auto Expenses: If you have a vehicle that you use for work purposes you may be able to deduct the cost of maintaining the vehicle as well as all business-related tolls. This can be a bit complex, however, because rarely are vehicles used exclusively for business. In these cases, the business-owner must properly apportion the use between personal and business purposes.
  •  Moving Expenses: If you moved to further your business interests, you may be able to deduct the costs associated with the move. Generally, you must move at least 50 miles and move in the direction of the business.
  •  Education Expenses: As a small-business owner, you are allowed to deduct the cost of further education if it is related to your area of business.
  •  Travel: If you travel for business you may be able to write-off many expenses that you incur on the trip. This is even the case if the trip is for both business and pleasure; you would just apportion the expenses accordingly. Keep in mind that if you take along the family, you can only deduct expenses that you incur.

 Do You Own Your Own Business?

 If you own your own business, you may be leaving valuable tax deductions on the table. By failing to take advantage of these write-offs, you are essentially giving free money away. To find out what deductions you may be able to take, you should speak with an experienced Illinois business attorney. Contact the Gierach Law Firm today for a free consultation.