| With tax season right around the corner it can be | | | | tax return. Promotional costs that create business |
| easy to get a little flustered by all the tax rules, new | | | | goodwill, such as sponsoring a little league baseball |
| changes, credits and deductions. Things are even | | | | team, are also deductible as long as there is a definite |
| more confusing if you're a small business owner. Read | | | | connection between the sponsorship and your |
| below to learn top small business tax deductions you | | | | business. |
| should be taking on your 2009 tax return. | | | | Interest |
| Start-Up Costs | | | | If you used credit to finance business purchases, the |
| You can deduct the expenses of running your | | | | interest on that credit is fully deductible. This also goes |
| business on your taxes, but nothing can be deducted | | | | for the interest taken on a personal loan. You just |
| before your business opens its doors. You can deduct | | | | need to make sure you conform to the IRS' rules if |
| up to $5,000 in start-up and $5,000 in organizational | | | | you borrowed money from a relative or a friend. Also, |
| costs for the first year of business. Expenses that are | | | | you must prove that the money borrowed was only |
| not deducted can be amortized over a 180 month | | | | used for business. |
| period, which begins the moment you open your | | | | Travel |
| business. These expenses include market research, | | | | With business travelling, you can deduct the cost of |
| advertising, employee training, business travel and other | | | | your airfare, costs of operating your car, taxis, lodging, |
| costs. | | | | meals and more. You must have records for all of |
| Auto Expenses | | | | these expenses. If you're combining business and |
| A lot of business owners will merely take the standard | | | | pleasure, you can only deduct these expenses if |
| mileage rate deduction, 55 cents per mile for 2009, | | | | business was the main purpose of your trip. However, |
| because it's easier to keep track of your mileage | | | | you can't deduct the expenses of taking your spouse |
| records, but you could actually get a larger deduction if | | | | or your family on your trip. |
| you keep track of everything, including repairs, | | | | Entertaining Expenses |
| maintenance, mileage, parking fees and insurance. You | | | | The IRS will approve the deduction of up to 50% of |
| can only deduct the business portion of your auto | | | | entertainment expenses for your business, but you |
| expenses if your car is used for both business and | | | | must follow these rules: it must be directly related to |
| pleasure, so keep track of the mileage accurately. | | | | the business and business must be discussed (such as |
| Education | | | | a meal catered to the office), or it must be associated |
| You can deduct educational expenses on your taxes | | | | with the business and the entertainment occurs directly |
| only if they are related to your current business or | | | | before or after a business discussion. Make sure when |
| occupation. The expense can be deducted if you are | | | | you're keeping records to make note of the business |
| furthering your education to maintain or improve skills | | | | purpose of these entertainment outings. |
| required for your job-not to get a new job. | | | | Professional Fees |
| Equipment and Furniture | | | | Professional and legal fees are deductible, but if the |
| Some businesses can deduct the full cost of their | | | | costs are part of your start-up expenses, you may |
| equipment the year they purchased them rather than | | | | need to amortize the cost over 60 months. |
| capitalizing them-meaning to deduct their cost over a | | | | Charitable Contributions |
| number of years. You can deduct up to $250,000 of | | | | If your business is a partnership or a limited liability |
| the cost of new equipment on your 2009 tax return, | | | | company, your business can make a charitable |
| but some assets don't qualify, such as real estate or | | | | contribution and pass the deduction onto you to claim |
| property bought from a relative. | | | | on your individual tax return. If you own a corporation, |
| Advertising and Promotion | | | | the corporation can deduct charitable contributions on |
| The cost of marketing, including business cards, Yellow | | | | the company's taxes. |
| Page ads, commercials, etc. is deductible on your 2009 | | | | |