Most businesses can make claims on the expenses that they need to pay for in order to keep their outfit operational. This applies to people who work at home, as well. In fact, there may be some specific deductions or benefits that could apply to you specifically because you work from home. Here, we’re going to look at some of the instances in which your home business could be getting some of its money back.
Note: Some links in this post are affiliate links, which means I receive a commission if you make a purchase. Affiliate relationships include, but are not limited to Amazon Associates, Walmart.com, and Etsy.
Home office deductions
Where do you run your home business? “From home” is the obvious answer, but do you run it out of your bedroom or living room when able, or do you have a room that acts as your primary place of business first and foremost, such as a home office? If the latter is the answer, then you might be able to claim deductions on expenses that go into making that home office, from painting or carpeting to even having some of the mortgage interest or rent paid off.
Deductions for being self-employed
Even if you’re not using a home office (i.e. a room that is specifically and primarily used for your business), you can still get a deduction on your self-employment tax. Every self-employed individual has to pay this tax to cover Medicare and Social Security costs. However, you may be able to deduct half of your entire self-employment tax from your net income when you’re figuring out your income tax. Half of the tax is treated as being paid by the employer, and the other half is treated as being paid by the employee. On that former half, you can treat it as a business expense, thus getting a deduction on it.
Products that you’re importing
If you run an eCommerce business, there is a good chance that some of the merchandise that you sell is going to be imported. Depending on your setup, you might be able to benefit from compliant duty drawback services, which can see you claiming some refunds on the duties, taxes, and other fees that are often paid on imported management. This is typically best done with the help of professionals who can help you analyze your imports and exports, as well as the documentation to support your claim to stick within the regulations.
Claiming on your insurance
It’s well worth the time for any business to invest in the appropriate insurance, even if you’re working from home. You might want to insure some of the equipment that you work with, for instance, or use liability insurance to take care of yourself in the event of legal trouble. However, you might not be aware of the fact that insurance is considered an expense just like any other and, as a result, you can file for a deduction on your taxes for any money you’ve spent on insurance.
If you’re wondering if there’s any other money that you might be able to claim back that you have been missing, it’s worth working with an accountant. Depending on how high your expenses are, you could claim back a lot of money.
This is a contributed post.
Subscribe so you never miss a post.
If you find my tips useful, feel free to support my work. Thank you in advance!
Be sure to check out our Etsy shop, NeededInTheHome.
Looking for deals? Read posts about Shopping Deals.
Subscribe to our Hot Shopping Deals emails so you never miss a deal!
Want to remember this? Pin it to your favorite Pinterest Board!
Join the newsletter
Subscribe to receive our latest articles and promotional content by email from NeededInTheHome