You already know how wonderful it can be to work from home, but do you realize how many home based business tax advantages there are? Here in the United States, many people operate home based businesses just to take advantage of the numerous tax deductions that can save them money.
Claiming the use of your home in your business can give you some hefty deductions on your tax return. As with anything tax-related, you must meet certain requirements determined by the Internal Revenue Service. However, if you use one room or part of a room in your home specifically for your business, you can receive a significant home based business tax deduction. This can include portions of your utility bills specifically related to that area of your house as well as any relevant home improvements.
The telephone and other office related services can provide you with a substantial home based business tax deduction. If you maintain a separate fixed phone line or cell phone specifically for your business, then all costs related to those phone lines can be tax deductible. However, if you use equipment or services in both personal and business environments, it is more difficult to establish a tax deduction. There are many benefits to running your business from home but you must meet some fairly strict requirements and maintain good records of your activities and individual deductions.
Using your car in your business gives you the potential for another good home based business tax deduction. Of course, you must keep excellent records but you can deduct mileage and car-related expenses that you incur while conducting your business like tolls, gas and car repair fees.
With any type of business, other incidental costs come up. You can also take deductions for purchases of items such as office supplies, postage, advertising materials and other costs. You can potentially deduct even more by hiring your friends and family members to work as employees for you. When you run your business from home it can benefit in many other ways but one of the most satisfying, is not having to participate in long commutes back and forth outside the home and you are able to spend more quality time with the ones you love at home.
To Your Success,
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