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Volume 23
March 2010
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Greetings!
Welcome to the Clean Team Pro! With the deadline for filing our annual income taxes right around the corner, I've definitely got good ole' Uncle Sam on the brain. What about you? Have you filed your taxes yet? If not, are you on top of all the paperwork? Or are you scrambling to find all your receipts and get them to your accountant in time? In either case, I hope that this month's feature article will shed a little light -- and money -- on the subject. We're looking at 40 little known or often forgotten write-offs for small business owners like you. This is especially important for those of you just getting started in the industry. At the beginning of a new venture, I know that the line between work and personal life can be pretty blurred -- it sure was for me! Don't let that blurriness cheat you out of legitimate deductions, though. Do you have any questions or suggestions to help us write a better newsletter each month? Please feel free to send them to me at jeff@thecleanteam.com. Here's to a happy spring season that's just blooming with new business! | |
40 Tax Write-Offs for Your Cleaning Business
April 15th is right around the corner. Have you
filed your tax returns yet? If your cleaning business is set up as an S-Corp or an
LLC, your business returns were due a few days ago on March 15th.
Fortunately you still have a couple of weeks to finish your personal returns.
If, however, you run your business as a sole proprietorship, then it's really
crunch time now! The good
news is that operating a business entitles you to a number of so-called
write-offs -- tax reductions for legitimate expenses you incur in running your
company. Whether you operate your cleaning business out of your home and drive
your personal vehicle, or you rent office space and lease a fleet of cars, you
may be entitled* to a host of little-known or often-forgotten tax deductions.
Here are 40 to get you started on the path to tax savings in 2010 and beyond.
Rent on office space or a percentage of your monthly
rent payment (or interest payments on your mortgage), if you operate your
business out of your home Renter's insurance or a percentage of your home
owner's insurance premiums, to cover your office equipment and supplies Utility bills such as gas, electric and water -- or a percentage of your monthly bills if
your business is home-based High speed Internet service -- if your company is
operated out of your home, your accountant may recommend that you only
write-off a portion of the bill to allow for personal usage as well Business cards and other office stationery, including design, printing and distribution
Website and/or blog design, hosting and maintenance Domain name fees, including the initial purchase and annual
renewal Printers, copiers, scanners, fax machines,
telephones, calculators, and other electronic equipment used in your
business. If you can't afford a copy machine and instead run off flyers at
your local Kinkos™, those expenses also count. Ink or toner for your printer, photocopier and fax machine Cell phones, pagers or beepers -- for you and any
employees (if cell phones are utilized for personal use as well, consult with
an accountant about how best to claim this deduction) Local phone bill -- if you work from home, you may want
to consider getting a dedicated office line. Otherwise, you will need to
consult with an accountant about what percentage to take off for personal
calls. Long distance phone bill, for business-related calls.
(Either keep track of itemized expenses, or use a business-dedicated phone
for all your long distance calls.) Books, DVDs or CDs related to your field. (Yes, all
those copies of Speed Cleaning you bought for your cleaners are most
definitely a business expense!) Newspaper, magazine or other periodical subscriptions
related to your field Participation in conferences, seminars and further
education classes related to the study of your field or the marketing of
your field Memberships in professional associations Laptops and desk top computers -- which are typically
considered a capital expenses. Consult with an accountant who knows the particulars of
your operation. Computer upgrades, including both hardware and software Computer accessories, such as hard drives, zip drives, recordable DVDs and CDs, and more
Office furniture, including but not limited to
tables, desks, chairs, lamps, bookshelves, filing cabinets Depreciation costs of your capital office equipment
(typically anything over $500) Washing machines and dryers, if used in the
commission of your business -- remember to include a percentage of your
water bill, too, if you wash uniforms and cleaning rags at your home Professional services, such as the fees you pay to
your accountant, graphic designer or copywriter Employee salaries and benefits Bonuses and gifts for employees --
including little trinkets you purchase for birthdays or holidays. And
remember, if you get a paycheck from your business, this counts for you,
too! Gifts or cards for clients... and care providers. You
can even write off gifts for family members if they helped you out. Say,
for example, your babysitter got sick, so your aunt watched your kids one
afternoon when you were visiting prospective clients. You bought her a box
of chocolates as a thank you gift. As long as you didn't exceed the $25/gift
limit, you are good. Just make a note on the receipt that it was for
babysitting when your sitter couldn't make it.
- Invoices, memo pads, magnets and any
other office paperwork used to run or market your business
Office supplies, including but not limited to pens
& pencils, notebooks, printer paper, file folders, tape, glue,
highlighters, paper clips, push pins, labelers, dry erase boards &
markers, etc. etc. etc. etc. etc. Posters, flyers, home mailers, door knockers and any
other printed advertising materials - you can write off the cost of
designing, printing and distributing them Online advertisements, such as Google ads, Google Map
ads, banner ads and professional association ads Offline advertisements, such as Yellow Page ads, want
ads, etc. -- both to promote your company and/or to find new employees Health insurance premiums & possibly
out-of-pocket medical expenses, too, for you and any employees Restaurant bills -- If you have your
weekly staff meeting at Starbucks or your Christmas party at the Olive
Garden, be sure to keep the bill! Postage and shipping fees -- USPS, UPS & FedEx 50% of your self-employment tax -- only if
you are self-employed. If you business has LLC or SCorp status, skip this
one. Fees on you bank accounts, such as fees for ordering checks or annual credit card fees Gas, parking, and tolls for any vehicles used in the
commission of your business. (Check with an accountant about how to deduct
travel expenses from a car that is used for both business and personal
travel.) Rental storage space for any
cleaning-related products you use or sell Employing your children This one is a little tricky, but if
you are a sole proprietor, you may be able to consider your kids' salary a business tax deduction,
with little increase to no increase in their taxes. Plus, if they aren't
yet 18, there is no Social Security or Medicare tax on their income. (LLCs and SCorps aren't eligible for this
break). Unpaid bills -- Hopefully
this won't happen to you, but if any of your clients fail to pay their
bill, you can deduct the unpaid portion as a business loss.
* Disclaimer: Be sure to consult
with a paid tax professional to see if these or other deductions apply to your
particular business. Remember that you must be able to show proof of your
expenses, so hold on to all receipts.
Did you learn about a business deduction you didn't know about? Do you have a favorite write-off I missed? Send me an email at jeff@thecleanteam.com if you'd like to
sound off on tax breaks for cleaning companies!
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Thanks for reading us this month! Come visit us on the web at www.thecleanteampro.com.
Sincerely,
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Jeff Campbell
The Clean Team Catalog |
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