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Ways to Save on Veteran Small Business Taxes: Deductions & Credits

By StreetShares on March 17, 2017

Ways to save on veteran small business taxes: tax deductions and credits

Did you miss the March 15 business tax filing deadline? Did you get an extension on your small business taxes this year? Well now you have several months until the final deadline on October 2, 2017. Let us help by letting you in on a few credits and deductions you could make on your business taxes.** 

Did you know that if you went “green”, hired a veteran, or started a company last year you might be eligible for three important but little known tax deductions?

Small tax deductions and credits take a little extra work, but your savings can really add up. Every dollar counts when it comes to running a veteran small business. We’ve compiled some resources of available credits and deductions your business may qualify for:

Does going green put more green in your wallet?

Going green or becoming a more environmentally-friendly small business makes sense (and dollars). Government agencies offer a variety of tax credits, rebates and incentives in support of renewable energy sources, such as the ones listed on the SBA’s website.

What if I hired a military veteran?

We strongly believe that veterans are a valuable asset to any business. They are dedicated, tenacious, hardworking, and have skills from the field that translate directly into building a business. They make great entrepreneurs, too. If you’ve hired a Veteran recently, you could qualify for tax credits, according to Military.com.

The Hire Heroes Act that came out in 2011 applies to businesses who hire eligible veterans by providing a Work Opportunity Tax Credit (WOTC). Eligible veterans include short-term and long-term unemployed veterans, veterans with disabilities connected to service, and long-term unemployed veterans with disabilities connected to service.

See also: Business Taxes: Everything You Need to Know

What about startups?

What if you haven’t even opened your doors? It turns out the IRS gives tax breaks even to startups. Any costs you incur before your business launches—such as explorative costs—may give you a deductible in your first year of business before you’ve even earned revenue. You can deduct up to $5,000 of the startup costs. Any costs exceeding that amount can be amortized over the next 15 years.

How else can I save for my small business?

Running a business incurs a lot of expenses. Thankfully, there are lots of deductions you can take:

  • Do you drive a lot for work? Costs for client meetings add up quickly. But you’re in luck— parking fees, tolls, and mileage on cars for business use can be deducted from your taxes.
  • Similarly, do you travel out of state for work? Out of town business travel costs, such as hotels, dining out, and plane, train or bus tickets, can be either completely deducted, or have a 50 percent deduction.
  • More than half of entrepreneurs today run their businesses out of their home. If you have a home office, you can make a deduction claim for that space. Qualifiers must satisfy two conditions: This space is the principal place of business and is used regularly and exclusively for business.
  • Are you taking business or accounting classes? Seminars or classes to improve your profession may be considered qualifying work-related education, which are tax deductible.
  • Have you purchased office supplies for your business this year? Hang onto those receipts because those expenditures will offset your taxable business income.
  • Have you purchased desks from Ikea? You can either deduct furniture expenses 100% in the year of purchase or deduct a portion of the expense over seven years. Furniture expenses included equipment used for business, computers, office furniture, printers and phones.

You may have missed the March, 15 deadline, but if you applied for an extension, you have some time. But don't wait. Start calculating these deductions and potential tax credits now. Getting your business taxes filed is not only mandatory, but it's also a way that many lenders like StreetShares look at the health of your business. Our team asks for one year of business tax history. If you're ready to apply for a veteran business loan, feel free to contact us today. 

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** The information contained on this website does not constitute legal advice or tax advice. Nothing on this website should be viewed as a substitute for the advice of a licensed attorney or accountant, which must always be tailored to your individual circumstances.

 

Topics: Veteran Small Business, Funding Your Business

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