By Bruce Freeman
The Small Business Professor.
It’s that dreaded time of year again. One thing you can’t avoid is taxes. But with some sound advice and a few good tips, the weeks before April 15 can be less painful.
I’m sure that it won’t come as a surprise that the idea for this column was the “brainchild” of an accountant friend of mine, Joe Rosenberg, a CPA in Florham Park, N.J.
QUESTION: I own a small local business and am getting ready to do my taxes for 2013. Are there any tax deductions that I may not be aware of that I should consider as I make up my return?
ANSWER: Mike D’Avolio, a CPA and a senior tax analyst with Intuit’s Professional Tax Group, shares a number of deductions you might not be aware of. But he also points out that in general, you’re allowed to deduct the costs of running your business as long as the expenses are ordinary and necessary, such as out-of-town business travel costs.
Be sure to document the expenses and retain any receipts. If the tax issues affecting your business are too complex to handle on your own, please seek out expert tax advice.
One deduction that business owners sometimes miss is a bonus depreciation deduction available in the year that new assets are purchased.
Businesses are allowed to claim a 50 percent bonus depreciation deduction, in addition to the depreciation deduction you would normally take for the asset.
So when you purchase new capital assets, like furniture and equipment, you can take a larger depreciation write-off in the first year. This bonus depreciation isn’t available if the asset that you purchased has been used previously.
Another deduction that’s often overlooked is startup expenses.