5 Overlooked & Little-Known Tax Write Offs for Businesses
John F. Dennehy Jr., CPA, PC

5 Overlooked & Little-Known Tax Write Offs for Businesses

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As a business owner, you have a lot to consider. But if you're not taking advantage of our top five overlooked and little-known tax write-offs, you could be missing significant opportunities. In fact, you could be overpaying in taxes and giving Uncle Sam funds that could be reinvested into your business. 

In either case, a tax write-off is a certain tax-deductible expense that originates from operating your business. Because most business owners are not well versed in complex tax codes and laws, they tend to overlook the following little-known tax write-offs. Read on for more, and don't hesitate to reach out to the team at John F. Dennehy CPA for tailored tax planning and guidance

Little-Known Tax Write-Offs for Vehicle Expenses

Many people will track mileage and use the standard mileage rate for the business miles they drive. But, there are other ways to track your vehicle expenses if you have more than one company car or use a personal car for work purposes. You may not be able to write the following deductions if you write-off your mileage when you file taxes. 

  • Gasoline
  • Tire Replacement
  • Insurance Premiums

In order to take advantage of these deductions, you will need to make sure that you keep very accurate records. If you use your car solely for business, you won’t need to prorate your deduction. But most people use their car for personal and business. In order to know how much you can deduct, you need to track how many miles you use for business vs personal and deduct the business portion.

Obscure Business Tax Deductions for Travel Expenses

Do you travel for work? If so, you may be able to write off related expenses as a cost of doing business. Your trip must be mostly business-related to work in order for this to be an expense. If eligible, you may be able to deduct expenses like:

  • Flights
  • Hotel Stays
  • Car Rentals
  • Baggage Fees

You need to make sure that all tax write-offs are what the IRS calls "ordinary and necessary." In other words, renting a Mustang may not be a tax deduction for a small business, but a Honda Civic might be.

Apparel Is an Often Overlooked Business Write-Off

Clothing is a tricky thing to deduct for your business. Regular attire that you can wear outside of work isn't eligible to be deducted, so even if you're only going to wear that suit for one conference you can't write it off. However, here are some things that can be

  • Safety Related Clothing- Steel-toed boots, safety glasses, hard hats, etc
  • Uniforms- This has to be something that is not appropriate to wear outside of work. Scrubs are deductible but Khaki pants are not
  • Costumes- Are you a performer? Things that you would wear on a stage are deductible as long as the clothes can't be reasonably worn outside of the performance
  • Swag - Do you like throwing your logo on things? If so you can deduct that polo shirt with your company logo as a promotional cost

As long as you follow the rules for what you can deduct and stick to business-related clothing, there are many ways your company's wardrobe can equate to savings. 

Education and Self-Improvement Are Common Tax Write-Offs That Are Overlooked

Any book, course, or publication that is related to the business is deductible. Self-improvement courses are also allowable as long as they have a connection back to work.

  • Books
  • Courses- Must relate to the business
  • Publications- do you have a waiting room? You can get that car and driver magazine subscription

The IRS requires that to qualify as a deduction the materials must be related to your business. This usually means having information that would never be found on the curbside.

Technology and Equipment Can Be Tax-Deductible

Equipment and technology are also deductible. Below is a list of items that are considered to be tax-deductible. Just remember to prorate it if you use a portion for personal use as well.

  • Smart Phones and Data Plan
  • Security Equipment
  • Computer Software
  • Software Subscriptions
  • Internet Connections and Web Hosting Services

Subscriptions & Software May Be Deductible

We live in an age of subscriptions and monthly fees for our phones, computers and software. It may seem like a minor expense, but it can really add up as tax deductions for small businesses. You may be able to deduct a portion of your internet if it is used for work purposes, but not just the entire thing.

Contact John F. Dennehy CPA

As a business owner, you work hard to grow your business and turn a profit. And when you partner with the experts at John F. Dennehy CPA, we will work just as hard to find savings and create a competitive advantage. 

We offer a range of services designed to make your personal and business life easier, including:

  1. Accounting and Bookkeeping
  2. Tax Preparation
  3. Controller Services
  4. And More

Contact John F. Dennehy CPA today for professional tax planning and to ensure you're not missing out on any other little-known tax write-offs.

About the Author John F. Dennehy Jr., CPA, PC

We at John F. Dennehy CPA are a team of certified public accountants who service clients throughout Long Island. The services that we provide are comprehensive, and we can resolve multiple accounting needs for a client.

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