As tax season approaches, MBO Partners shares its recommendations for tax deductions.
Here are ten tax deductions to consider for your independent business.
One of the best tax advantages for the self-employed are retirement plans. Tax deductible qualified plans include:
- An individual 401(k) is ideal for individuals with no employees. For 2017, you can contribute up to $18,000 plus an additional 25% for a maximum contribution of $54,000. This amount increases if you are 50 or older.
- The Savings Incentive Match Plan for Employees (SIMPLE) IRA is ideal for those who employ others. It allows employers to contribute to their employees’ retirement.
- The Simplified Employee Pension (SEP) IRA allows you to contribute the lesser of 25% of income or $54,000 for 2017.
2. Phone and Internet
Deduct phone, Internet, and fax expenses directly related to your business. For example, if your cellphone is for both business and personal use, you are only eligible to deduct the percentage of your bill that relates to business usage.
Anything you do to enhance your job-related skills or round out knowledge related to your business can be deducted. This may include an online class, certification course, seminar, books, or subscriptions to professional publications. Be sure to save receipts of all purchases, including e-receipts.
Read the rest of the story at Top Self-Employed Tax Deductions | MBO Partners