4 Tips & Tricks to Make The Most Out of Tax Deductions

Advisor July 15, 2021

We know it, we understand it, but we don’t want to accept it. That one-liner perfectly defines the condition of every taxpayer.

The New York Public Library/Unsplash | Whether you’re a small business or a large one, you have to pay taxes without fail

Whether you’re running a million-dollar firm or a small organization, paying tax will always pinch you. But at the end of the day, it’s a necessary evil you must accept. Almost like mortality!

Paying taxes is an unavoidable part of life. However, with a few tricks up your sleeves, you can try and save a little on them. Well, who wouldn’t mind saving a few pennies, right?

Knock off your rental expenses

You don’t have to have a home office setup to take advantage of the tax deductions. If you rent a property for business purposes, you can subtract the rental amount from your returns. Wondering how you’ll do that? It’s simple, really; you only have to follow the steps involved in writing off a portion of your rent for a home office. Along with that, you can also deduct the expenses you pay for using a parking lot or leasing equipment. Just make sure that the bills meet the eligibility standards, and you’re good to go.

Deduct your office supplies

Every penny you spend on buying stationery, cleaning materials, computer software, printer ink cartridges, kitchenware, or any other item is deductible as long as you use them for business purposes. You can also deduct work-related postage and shipping costs. But while writing off office supplies, make sure to file all receipts of purchases for documentation.

Tim Gouw/Unsplash | Every penny you spend on buying stationery, cleaning materials, computer software, etc. is deductible as long as you use them for business purposes

Write off your moving expenses

Last year was troublesome for every organization; many entrepreneurs struggled to keep their firms in the business. Some even had to shift to cheaper places to cut down their costs. If you too had to find a new spot for your company, well, congratulations, you’re eligible to write off the moving expenses from your returns.

Though the 2017 Tax Cuts and Jobs Act barred private moving expenses deductions, business owners can still take advantage of this. That means all the money that went into hiring a moving company, paying for gas, and renting vans can be written off.

Remember maintenance and repairs expenses

With the office being closed due to WFH, many owners might find this to be the right time to get over with repairs and maintenance. Such expenses are a must for every organization, but now with tax deductions, organizations can save a lot of money on such things. According to the IRS, regular maintenance activities are deductible, but activities aimed at capital improvements can’t be written off.

Theme Photos/Unsplash | According to the IRS, regular maintenance activities are deductible

Looking at these tips, you might feel that you might have saved a decent amount of money had you known them earlier. But as they say, better late than never. So, use these tips in the coming years and make the most out of tax deductions.