Legal and Ethical Tax Benefits for Home Business

Does a Home Business Really Have Legal/Ethical Tax Benefits?

Yes! There are more tax deductions for a home business than most people realize.

We’re not tax experts and we’re not able to provide specific advice except to say that you should discuss your particular situation with a good accountant or tax attorney.

However, we can give you some examples of the things that might qualify as tax deductions in the United States.

If an area in your home (office or spare bedroom) is used primarily for your home business, it might be a tax deduction. For example: if that space is 10 percent of your home’s total square footage, you might be able to deduct 10 percent of your mortgage and utility payments as a business expense.

Office supplies (paper, ink cartridges, pens) might qualify for a tax deduction.

You might be able to deduct some or all of the cost for things like web hosting, email service, Internet provider fees, and so forth, as long as you can show it is needed for activities that are related to your home business.

Part of the cost for a lunch or dinner might be a deduction if you discussed your home biz with a prospect or fellow networker. Keep a record of date, place, who was there, and topics discussed.

There is a deduction for the number of miles you drive in your car on business-related errands or trips. Motel and other expenses might be a deduction if you were out of town for legitimate business-related activities.

An accountant or tax consultant might not know all of the various deductions for a home business, so it’s best if you do some reading/research on your own and tell them which deductions apply to you. It’s well worth the time and effort because there are plenty of tax deductions available.

A little bit of effort can result in paying less tax for the year or getting a bigger refund.

Our own experience, plus what we hear from others, shows an average savings of $5,700 each year by taking advantage of home business tax deductions. That’s a nice difference!

Good records help you verify the deductions you claim. It only takes a few moments now and then. It’s a nice return for a small investment of time. Think about this - most people won’t get paid at a regualr job if they don’t take a few moments to punch the timeclock or fill out a work slip.