Tax deductions are the way to lower your tax bill. So let's cover them all!
What is a small business tax deduction?
A small business tax deduction is an IRS-qualifying expense subtracted from your taxable income. According to the IRS, business expenses must be both ordinary and necessary to be considered deductible. The purpose of tax deductions is to reduce the overall total income that is subject to federal and state-imposed taxation.
How do business tax deductions work?
When filling your small business taxes there are two primary ways to claim tax deductions: taking the standard deduction or itemizing your deductions. Which route you choose is entirely up to you, but if you’re interested in taking advantage of small business tax deductions, itemizing is the way to go.
Complete list of small business tax deductions
There are dozens of small business tax deductions that you may be eligible for, but half the battle is figuring out which ones are the right ones. Our list will give you the rundown of all of the small business tax deductions to explore when filing your 2020 taxes. Be sure to consult a CPA or other tax professional before sending your return off to Uncle Sam.