Numerous tax saving strategies are available. This article provides a sample of the hundreds of business deductions available that can slash your taxes.
Know thy tax codes! Tax codes can save you thousands of dollars if you use them properly. Following are codes and tax deductions that you can take immediately. (You can do these things even if your business is new.)
Power Tax Tool #1: Section 280: Home Office deduction and related expenses. Your CPA will say that these put up a red flag with the IRS, but that is not true. If you do it properly, it is legal.
Power Tax Tool #2: Section 274: Food, office equipment.
Power Tax Tool #3: Section 132: Deduct your corporate gym.
Power Tax Tool #4: Section 105 and 106: Deduction of health care costs. Chiropractic, eye care, laser surgery. 100% tax deductible.
Power Tax Tool #5: Section 162: Seminars and achievement awards. You can write off the entire cost of seminar: hotel, transportation, and products you invest in. Your company can give up to two achievement awards each year worth $1,600 a piece. You can give the achievement award to yourself since you are the sole person in your business.
Power Tax Tool #6: Section 274: Season tickets and club memberships can be written off 100% if you do it correctly. Have to do these correctly because if you don’t the penalties and interest can be more than the tax was to begin with.
Power Tax Tool #7: Section 119: Meals and lodging: Can write off 100% while traveling for business.
Corporate meetings and vacations. You’re in a business so you don’t go on “vacation”. However, the IRS requires that you have an annual meeting. So take the annual meeting in a vacation spot and pay for the entire meeting (vacation) through your business.
Power Tax Tool #8: Kids can be put on the payroll and can be paid up to $6,500 per kid per year. You can opt to put this money in an education IRA.
Power Tax Tool #9: Section 129: Nanny and nurses. You can write off $5,250.
Power Tax Tool #10: Section 127: Scholarships. You can also pay for private school with pretax dollars. You can write these costs off through your business.
Power Tax Tool #11: 217: Executive move. Storage, packing, moving can be written off as business expenses.
Power Tax Tool #12: Fringe benefit programs.
Power Tax Tool #13: If you buy new equipment that is 60,000 pounds or more, you can write off the whole cost THIS year. (Note: The tax code changes yearly.)
Power Tax Tool #14: Retirement plans: Roth, Sep, IRA, and IRA business system. IRA business system is when you can self direct your retirement fund. You gain check book control over the money in your retirement system. This means that you can access money in your retirement account for things such as real estate transactions and other business ventures.
These are just 14 deductions out of a possible 300 deductions.
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