NSCA recently sent an email to members reminding them that they can deduct their association dues from their business taxes (sole proprietors and single-member LLCs, show these expenses in the “Expenses” section of Schedule C; partnerships and multiple-member LLCs, show these expenses in the “Deductions” section of Form 1065; corporations, show these expenses in the “Deductions” section of Form 1120). While the tax discussion is not going away anytime soon, and we’ve talked about the issues you should be concerned with, what about the benefits you can still take advantage of as a small business owner?
Below is a list of perhaps common expenses you can deduct from your taxes. But, always remember to be organized and keep receipts to help your tax professional.
- State & Employment Taxes; Social Security
Remember the payroll holiday tax may also be ending on December 31, 2012, although some reports state the President is asking Congress to extend this another year. Stay tuned to NSCA alerts for additional information on this issue.
- Auto Expenses
You may deduct mileage, parking fees and tolls for business use of your car. Pay attention to your actual expense method – this may yield a higher deduction.
- Association Dues; Professional & Legal Expenses
Professional and legal expenses are deductible, but if the costs are part of startup expenses, you may need to amortize the cost over 60 months. NSCA does not use your dues to lobby – so you do not need to worry about this for deducting your NSCA dues.
- Equipment, Furniture Supplies
Ask your tax professional about expensing or depreciating these purchases which also includes software and professional publications. Also, remember that bonus depreciation expires December 31, 2012. Also know if you should amortize the costs – but remember, it’s not always good to buy, just to buy – have a purpose or save your money!
- Start-Up or Expansion Expenses
If you are thinking of expanding or starting a new business, make sure you choose to amortize or deduct these expenses in the first year of business.
- Home Office
To qualify, the room must be used exclusively for business. You can deduct a portion of rent, utilities, insurance, taxes, maintenance, professional cleaning, depreciation and interest. Additionally, dedicated services for your business (telephone and Internet) are deductible.
- Education & Training
Continuing education or certification for the business you’re already in is the only qualified deductible education & training.
- Bad Debts
You must declare income before you may deduct bad debt.
- Interest on Loans
Deduct interest on loans for your business.
Save all your receipts, and don’t forget to keep track of contributions of inventory or property. Don’t forget to support the integration industry and make a donation to the NSCA Education Foundation!
- Other Considerations
Keep excellent records of gifts, advertising, entertainment, travel, and other expenses.