When it's time to do annual tax filing, some work at home moms and other business individuals tend to miss some of the possible small business tax breaks that they could get from the IRS. Having a professional tax preparer can help you be more savvy about what the government is willing to help you deduct as a business gain or loss on your tax filing. Here are some of the items that often get overlooked on a prepared tax filing.
Home Office and Related Deductions
Some work at home individuals have a hard time figuring out the rules and restrictions for deducting a home office. Some just skip this process entirely, which can end up costing a business money. First, there are direct deductions for home office spaces in terms of utilities, furnishings and other costs. Then there are also deduction amounts related to the overall property, from depreciation costs to indirect whole-home costs.
This critical element of business action also tends to fail to show up in annual returns. While some business leaders might not know about mileage deductions, others might not be able to claim this deduction because they have not recorded it correctly. It can be extremely hard to record business mileage correctly when you're on the go. New modern applications for smart phones and other electronic solutions can help business people more accurately record their mileage during the year.
Operating Expenses for Research and Development
Some small businesses actually put money into secondary processes that help their business to turn a profit. One of these is business research. Ask your professional tax preparer about how business research costs could fit into an annual tax filing.
These are some of the most basic elements that business people should think about when getting acquainted with a specific annual filing for small business taxes.