In these challenging financial times, we’re all searching for methods to stretch our dollars to the max. Many of us consider different ways to increase our income, decrease our spending, or save our investments from loss.
There’s one simple and effective approach that’s overlooked by many. That is to keep many more of your hard earned dollars through maximizing your federal tax deductions.
If there were a way for you to convert many of your everyday expenses into federal tax deductions, thereby decreasing your income taxes, would you be interested in learning more? Well then, read on my friend!
There’s a secret that’s been well known and used by the wealthy for generations. There’s even a joke among the rich that the only difference between tax evasion and tax avoidance is five to eight years!
You see, the tax laws were written in the late 1800’s, during which time the “movers and shakers” were business owners. Small business tax deductions were incorporated into law, in favor of these lawmakers. The federal tax deductions allowed them to legally avoid paying taxes on expenses that are were not deductible for lower class citizens.
Whether you own a large corporation or a small home based business, as an entrepreneur you’ll benefit tremendously from a large increase in your federal tax deductions. A penny saved is a penny earned, and saving money through small business tax deductions can save you thousands of dollars each year.
As a business owner, many of the things you already spend money on can become federal tax deductions. A partial list of small business tax deductions includes the following:
We’ve all heard of mixing business with pleasure; this can be a very profitable habit for small business owners. Many of the items in the list of tax deductions above lend themselves very nicely to this practice.
For example, by combining travel with a business purpose, your vacations can become “paycations”! You can take an internet and computer tax deduction on a computer that you already have in your home, as long as you’re using it for business purposes. When you shop for business supplies you can write off your mileage, even if you drop your drop your child off at a friends’ along the way. It may take a bit of planning ahead, but there are countless ways you can take federal tax deductions for everyday expenses. And it’s all 100% legal!
So, just to give you an idea of the impact this would make on your finances, it might be helpful to put together a worksheet. If you add your monthly internet, cell phone, and home phone expenses, and multiply them by 12, you’ll have an idea of the minimum amount of money that you could write off on your taxes each year. If you qualify for a tax deduction for home office this could add a substantial amount of money to your federal tax deductions. Once you begin to add expenses such as mileage, retirement savings, “paycations”, etc., your federal tax deductions can increase significantly.
Given the low risk factor involved in starting a home based business, the potential monetary rewards, and savings through federal tax deductions, many financial experts are advocating home business. Among them are Donald Trump and Robert Kiyosaki, who have partnered to promote small business ownership as an effective method for the average person to create wealth. I don’t know about you, but I think they probably know what they’re talking about!
Disclaimer – The information in this post is not intended as professional tax advice. Please consult a qualified CPA for advice and strategies to help you maximize your federal tax deductions.