Home Business Tax Deductions & Tax Return Software 1-2-3
When it comes to filing tax returns for your business, you have two options:
- You can hire a tax professional to complete your taxes or
- You can do them yourself.
Some independent contractors, freelancers and home-based business owners who don't have any other employees
file their own tax returns using one of the well-known and trusted tax software programs.
When a business is small and has a simple business structure, this makes more sense than it would for a
larger more complex organization.
If you've used tax return software for your individual return, you'll see that business tax return software
is very similar. Programs walk you through each step on the form and will alert you of possible home business
tax deductions.
Alternatively, small business owners can hire an accountant or tax preparer to handle their tax returns for
them. The difference in cost is generally upwards of several hundred dollars. The benefit is that you don't
have to spend time completing the return.
So what is tax deductible? As you will see in the tax deduction list below, many of the items are 100%
business related. However, with home office tax deductions, things like insurance or office expenses may be
need to be split between business and personal use. Tax prep software generally alerts you to these items and
helps you calculate the proper percentages.
IRS Guidelines: The Business Tax Deductions
List:
- Advertising
- Bad Debts
- Car and truck Expenses
- Commissions and Fees
- Depreciation on Property Owned by Business
- Employee Benefit Programs
- Insurance
- Interest
- Legal, Accounting & Professional Services
- Maintenance/Repairs on Business Premises & Equipment
- Office expenses
Pension/Profit-Sharing
Plans- Rent
- Supplies
- Taxes and Licenses
- Trade Publications
- Trade Shows & Conventions
- Travel, Meals, Entertainment
- Utilities
- Wages
More information: IRS Publication 535 (You can
also get information at the IRS Website on business income tax, self-employment tax and estimated taxes).
|
Home Business Tax Deductions Made
Easy
 This is the Ultimate Tax Handbook for the self-employed. I own this
book myself. You can greatly increase your profits simply by capitalizing on small
business tax breaks you didn't even know you had.
Stephen Fishman digs deeper than just a list of write-offs. For example, for "rent" the book
explains all of the different types of rent your can deduct, and what is considered rent. Same
thing with employee benefit programs - what are they and how can you take avantage of numerous
opportunities - not just one.
A one time investment can save you money in self employed tax deductions year after year.
**Check to see if it is available used.
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More Business Tax Return Software Programs:
In addition to alerting you to deductibe business expenses, tax return software saves lots of time,
translating form jargon into plain english, making calculations for you and inserting data into your tax return
form where it needs to be placed. Some tax software companies like H&R Block, offer "Worry-Free Audit
Support", so if you have any doubts - you can sleep better at night.
The personal software version is not what you want for your home business taxes. You want business tax
return software. However, if you can get personal and business versions combined in one package - this is where
you'll get the best bargain.
TurboTax Home and
Business
lets you try out the
federal program free - pay only when you file. This is a good option for those who have never prepared
their own tax returns - or who want additional support without having to pay for it.
H&R Block has small business tax return software
which actually includes live advice from a real person
, and you can use it whether you own a corporation, an LLC, have a partnership or a non-profit business.
One personal state return included.
If you are self employed or own rental property (not in a corporation, LLC, etc) and want to make sure you
get your small business tax deductions, use H&R Block at Home Basic.
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