Tax time is here and it can get pretty crazy knowing exactly what to do as a self-employed entrepreneur and what deductions you can get back – to either lower how much taxes you owe, or heighten the amount you’ll receive. At best, it is always great to seek further advice from an accountant that you can trust, but listed below are a few suggestions as to what you can deduct when you file this year’s tax return.
So What Is A Deduction?
A tax deduction is any related business expense that is deemed ‘ordinary and necessary’ from the IRS for conducting that business and can be subtracted from your gross income. Once subtracted, you can find out the amount that can be taxed. Again, always double-check IRS regulations and consult with your accountant.
The more deductions, the lower your taxable income, so it’s very important to keep track of your expenses from the very beginning! Keeping track of your income can be as simple as using a spreadsheet on your devices, or keeping pictures of your receipts. Anything that tracks the time and reason for the expense will do just in case of an audit.
As a blogger, here are a few business deductions you can claim:
- Business start-up costs: let’s think in terms of name and domain registration, website hosting, and licensing fees.
- Advertising and marketing costs: social media ads, etc.
- Educational expenses: courses, or any professional classes you may have taken that relate to your business.
- Health insurance.
- Business insurance.
- Office supplies.
- Travel: business travel, lodging, and transportation.
- Rental fees: vehicles, machines, and/or equipment.
- Transaction fees: Paypal, credit card, or banking fees. Who knew those few dollars they take out per transaction could be deducted? Feels good, knowing you can get those back.
- Home office: this is if you have a separate space in your home used exclusively for business.
- Internet services.
- Employee benefits and wages: virtual assistants, social media manager, etc.
I’m no expert, so as I stated before, talk to your accountant and make sure it’s someone you trust. If you’re like me and more comfortable filing on your own, you can use H&R Block’s self-employed services and file for less than $50. Or, get 30% off Liberty Tax Filing solution.
Personally, I’ve been using H&R Block since I was able to file my taxes when I was both employed and self-employed and they have not let me down yet.
Again, I am no expert at this, but I wanted to make you aware of the possible deductions you can write off and how you can save yourself as much money as possible.