When you’re running a small business, there are a lot of expenses that you can write off on your income tax return. Publication 535 from the IRS discusses what is and is not deductible, and there’s a lot of information in there that could help reduce your taxable income.
Some of the top deductions for small businesses include business meals, automobile expenses, and rent for property used for business purposes. Keep in mind that these are just a few of the many itemized deductions available to small businesses. Some more common write-offs for small businesses also include:
This includes things like office supplies, home office deductions, advertising, and travel costs related to your business.
If you purchase equipment or furniture for your business, you can write off a portion of that cost each year.
If your business experiences a loss in a given year, including bad debts, you can usually consider this tax write-off.
Make sure you consult with a qualified tax professional to find out which tax deductions are available to small business owners including sole proprietors, to address their specific situation in Washington state. Ultimately, by knowing what expenses are deductible, you may be able to reduce the amount of tax that becomes due on your tax bill.