Business Expenses That Can Be deducted On Schedule C

The IRS indicates that a business expense is deductible if it is ordinary, necessary and directly related to running a business.

The following categories are included on the Schedule C, IRS form, used by sole proprietors to report their income:

  • Advertising
  • Car and truck expenses
  • Commissions and fees, contract labor
  • Depletion
  • Depreciation and section 179 expense deduction
  • Employee benefit programs
  • Insurance, interest
  • Legal and professional services
  • Office expense
  • Pension and profit-sharing plans
  • Rent or lease
  • Repairs and maintenance
  • Supplies
  • Taxes and licenses
  • Travel and meals
  • Utilities
  • Wages

Additionally, the following expenses fall under the 20 categories from Schedule C and are deductible:

  • Utility Expenses for Small Business Owners
  • Rent or Mortgage Payments
  • Home Office Costs
  • Website and Software Expenses
  • Business Licenses and Permits
  • Bank Fees and Interest Payments
  • Professional Fees and Business Services
  • Entertainment Expenses
  • Business Meals and Travel Expenses
  • Furniture, equipment and machinery deductions
  • Office Supply Expenses
  • Marketing and Advertising
  • Membership Fees
  • Auto and Vehicle Expenses for Business
  • Business and Health Insurance Premiums
  • Payroll
  • Local and State, Property, Payroll Taxes
  • Employee benefits
  • Training and education

Funding To Sustain Or Expand Your Business

Many small businesses have struggled to stay open and operate profitably in the current market conditions. A raise in prices and low cashflow can make it difficult for small businesses to operate. Business financing can help owners fund their businesses.

The Small Business Administration (SBA) helps small businesses obtain funding funding through different types of loans, including  direct loans for disaster recovery and  COVID-19 relief programs. The loans offered can be classified as 7(a) loans, 504 loans, Microloans

7(a) loans are the best option when real estate is part of a business purchase, but it can also be used for:

  • Short- and long-term working capital
  • Refinance current business debt
  • Purchase furniture, fixtures, and supplies

504 loans are long-term, fixed-rate financing to purchase or repair real estate, equipment, machinery, or other assets

Microloans are $50,000 or less loans that help small businesses and certain not-for-profit childcare centers start up and expand.

Visit the Small Business Administration website at: Loans (sba.gov)

Tax Write-offs for Small Businesses

You are working hard making your small business profitable. Expenses are piling and tax write-offs (i.e., deductions) are a helpful relief for your small business on tax day.

What Can A Small Business Write-off?

Your business expenses can translate into tax write-offs if they are considered essential to your business and common in your industry. Here’s a list of common deductions made by business owners in any given tax year:

  • Office space rent or used for business, including home offices
  • Related utilities; home-based business owner can deduct a percentage of their home utilities total
  • Office expenses, such as paper and printer ink
  • Equipment (from computers to specialized tools and machinery)
  • Internet and phone
  • Software
  • Payments to employees and independent contractors
  • Business related training and education (including subscriptions and publications)
  • Credit card processing fees, merchant and gateway fees
  • Advertising and marketing, website related expenses
  • Taxes (real estate taxes, payroll/self-employment taxes, etc.)
  • Business insurance and E&O insurance coverage
  • Local and state business license fees
  • Retirement plans and other benefits
  • Interest payments
  • Business travel, vehicle used
  • Business meals (50% can be deducted)

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About Your Credit Score

Credit score is the “magic” number that lenders and landlords look at when you apply for a loan or a rental property.

Can you get your Free Credit Reports online?

You can request free credit reports from annualcreditreport.com, the only authorized website for free credit reports. You will need to provide your name, address, social security number and your date of birth for verification purposes. As monitoring your credit reports is important, the annual credit reports do not include credit scores.

How can I get my Credit Score?

You can be obtain your credit score by signing up with any or all of the three major credit monitoring bureaus: Experian, Transunion, Equifax.

Additionally, credit card providers offer their clients options to view their credit score and basic credit report online. The basic credit report includes items like total debt, available credit, history of credit score changes over a period of time. One can also sign up for credit report alerts through the same services.


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