Okay.. So your SELF EMPLOYED what deductions can you use?

Okay.. So your SELF EMPLOYED what deductions can you use to make the amount you owe in taxes lower…. Well to start it depends on if you have an office in your home, or if you have a building you operate out of.. So both of those can change a few things.. For example if your house in 1,000 square foot and your office is 200 square foot which is 20% of your house.  Lets say your electric bills for the year cost your 2,000 dollars… 20% of 2,000 dollars is $400 dollars – that right there is a large deduction for your taxes.

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There are to many things to list that you can take off of your self employed taxes so far as deductions go… Remember I am not a pro on taxes and this is not legal advice, just some tips from someone that wanted to save money on my taxes myself and found as many of the deductions possible that help cut down what you owe on taxes because of your expenses.

Dues and Fees:

  • Dues to a professional organization for people in your profession
  • Union dues, initiation fees, and assessments for benefit payments to unemployed union members.
  • Regulatory fees for your profession
  • Dues to chambers of commerce and similar organizations if the membership helps you carry out your job duties (see exceptions).
  • Licenses paid to state or local governments

 

Maybe you own a computer business like I do currently, If i bought a new computer and use it for business I can take that as an expense as have it as a deduction on my taxes. download

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Books and Publications

  • Books, trade journals, newspapers and publications for your trade or profession

 

  • Education and Research
    • Educational expenses related to your present work that maintains or improves your skills.
    • Research expenses

     

  • Equipment and Supplies
    • Business use of computer.  Employees:  Must be for the convenience of your employer and required as a condition of your employment.
    • Supplies and tools you use in your work

 

 

This could be a big one that could save you alot – ask your tax professional
Self-Employed (Schedule C):
You are allowed to deduct most business expenses in full.  Meals are deducted at 50%.

 

Below information from jamesdance.com

Deductions

Many clients ask me what they can deduct, so I am providing the following lists of possible deductions.  The lists are only meant to give you ideas, or steer you in the right direction.  They are not all-inclusive and not all items are deductible all the time.  Many are subject to limitations, may only apply in certain situations or are governed by other rules.  Please keep careful records and save your receipts for 3 years in case of audit.

Schedule A Expenses

Taxes You Paid

  • State and local income taxes or general sales tax
  • Foreign income tax
  • Estimated tax payments
  • Prior year’s state and local income tax you paid during the tax year (do not include penalties).
  • Disability insurance tax (some states)
  • Occupational taxes
  • Real estate tax (state, local or foreign). 
  • Portion of condo and coop maintenance that includes real estate tax.
  • Personal property taxes based on value.  This includes auto registration or licensing fees, but only the portion based on value, and only if charged on a yearly basis.  Varies by state.

Interest You Paid

  • Mortgage interest
  • Late payment charge on mortgage payment
  • Mortgage prepayment penalties
  • Points on principal residence financing
  • Mortgage insurance premiums

 

Gifts to Charity

  • Charitable contributions (cash and non-cash) made to qualified U.S. charities and certain charities in Mexico, Canada and Israel.
  • Mileage to donate goods to charity or to perform charitable services.

 

Other Expenses

  • Casualty and theft Losses
  • Investment expenses:
    Fees for tax return preparation
    Investment counsel and advisory fees
    Certain legal fees
    Safe deposit box rental
    Interest on margin accounts

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Maybe you run two small businesses… but did not really make money from the new one since you spent the year building it – you can take those as losses for the year and it will count as an expense and save your money on your current self employed taxes…

 

 

good luck and happy money saving!

 

 

 

Above information is for the U.S.A.

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