They are an important part of the tax season, which incidentally starts one week from today, and they also help you save some money. And we all love saving that dough. In preparation for this tax season, you should be collecting things that you can write off. But what exactly qualifies as a tax write-off? So glad you asked.
If you are an independent contractor, here are six things you can write-off this season:
Necessary items for your business
Any expenses that are common and necessary in your trade can be written off. It just needs to be items that are appropriate and helpful for your business.
Okay, well not your whole car. But you can write off the mileage needed for your work. So be sure to keep track of the dates of your trip, business purpose, and total miles per trip. There are handy apps you can have on your phone to track your mileage – for some suggestions, see our previous blog post “There’s an App for That!”
All travel costs away from your tax office incurred on business days can be written off. To do this, keep track of your receipts, travel and work dates, and your business purpose.
Even though it may be tempting, not every meal can be written-off just because you “thought about” work while eating. But you can write-off legitimate meal expenses. For example, a business meeting or discussion, or a clear business intended purpose. Keep track of those receipts, who you met with, and why.
Not your whole home, just the area in your home that is intended for business purposes only. You can deduct about $5 bucks per square foot in your home office.
Computer and Phone
You can write off your phone and computer based on the business use percentage. Gold Standard can help you figure out the exact usage and monetary benefits, as long as you keep good records. Keep track of your personal versus business use on both.
Phew, now that helps us independent contractors out this season, doesn’t it?