7 Most Popular Business Tax Deductions

by Roni Deutch Tax Center

Tax season may still be a few months away; however, it is important for owners of a franchised business to think about tax planning all year long. By keeping track of your expenses and the deductions you qualify for, you can help keep your tax liability low.

1. Startup Expenses
IRS rules allow you to deduct up to $5,000 of your expenses in starting a business. These expenses are known as capital expenses and you can deduct them during the first year you are in business. If your total startup costs exceed $5,000 then the remaining amount must be deducted over the next fifteen years.

2. Auto Expenses
If you use a vehicle for business purposes then you can deduct some of the associated costs. The specific rules around auto expenses are tricky to understand but basically you can either track and deduct all the business related expenses, or take the standard mileage rate.

3. Education or Learning Materials
Any costs associated with business related education can be deducted. This includes both payments made for self-improvement for you and your employees. Night classes, seminars, conferences, and even books are great examples of learning expenses.

4. Advertising, Promotions & Publicity
Small business owners usually remember to write off the costs of paid advertisements. However, do not forget that you can deduct any costs related to promoting your business. These expenses vary widely from business cards, printing flyers, etc.

5. Travel Expenses
Anytime you travel for a business purpose you can deduct all related expenses. This includes plane fare, taxis, hotels, meals, calls, faxes, etc. Just make sure that you keep all receipts so that you are prepared for an audit.

6. Business Meals & Entertainment
According to the IRS, you can deduct up to 50% of the cost for business related meals and entertainment. This includes business lunches, catered office events, and even entertainment taking place immediately before or after a business discussion.

7. Charitable Contributions
If your business is a partnership, LLC, or S corporation then your business can make charitable contributions that you can pass onto your individual tax return. However, you cannot include donations of office equipment that has already been deducted.

- Roni Deutch Tax Center

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