Be Smart About Taxes

This Year

Did you buy a book, attend a conference or enroll in an online seminar to learn about topics relating to your current business? If you did, some of these costs may be deductible. Costs incurred while traveling to a conference or other business function are also tax-deductible. Or buy an ad in a nonprofit’s program and deduct it as an advertising expense.

Other overlooked deductions might include business meals and business entertainment, for which you may deduct half of any reasonable cost. Make sure you keep detailed records, eliminate non-business costs associated with lodging and save receipts for any expense you plan to deduct, as well as details about the business conducted.

Self-Employed

If you are a one-person operation and you have a home office used exclusively for business, you can deduct some of the cost of home insurance and utilities. Also deduct health insurance premiums and SEP-IRA contributions. You have until your tax filing deadline in 2018 to make the latter.

Future Reference

Depending on how your business is legally structured, you may be able to deduct the entire cost of business equipment or depreciate the cost over five or more years. If you’re still using pencil-to-ledger accounting, you might want to explore software that can make your recordkeeping easier.

Also take an advance look at how next year’s taxes might look. A bump up in net income might spur you to accelerate deductible purchases or push off income until 2019. This is a good time to work with a financial professional to compare retirement plans. You might find a plan that helps you reduce current taxes while you and any employees put more money away for retirement.
Talk to a tax professional to learn more about your situation.