Everyday Business Expenses May Reduce Your Taxable Income

Business owners often overlook deductions connected to ordinary daily operations. Expenses may generally qualify when they are common, reasonable, and helpful for running the business.

Home office, computers, and phones

A qualifying home office may allow you to deduct part of certain household expenses, but the space generally must be used regularly and exclusively for business. Computers, cell phones, and internet expenses may also qualify based on the percentage used for business. IRS Publication 587.

Vehicles, meals, and travel

Business vehicle expenses may be calculated using an approved mileage method or actual eligible costs. Keep a mileage log showing the date, destination, distance, and business purpose of each trip. Business meals are generally limited to a 50 percent deduction, and travel expenses must have a genuine business purpose and meet IRS requirements. IRS Publication 463.

Keep good records

Good records are essential. Save receipts, invoices, mileage logs, meeting details, and travel documents throughout the year.

Contact Austral Financial Services to discuss which expenses may apply to your business.