Tax Deductions
A tax deduction (tax write-off) is an expense that a business owner is entitled to subtract from their gross income, resulting in lowering their taxable income (the amount on which they are taxed on.)
There are three types of deductions in tax return: personal, business and investment deductions. Business deductions are based on expenses that are spent to run the business. The IRS taxes on profit, not on gross income. The key point here is that the more you deduct, the lower your profit (taxable income) will be. The important rule here is all deductions should be done within the legal limitations. All tax deductions should be supported by records or documents.
Types of Deductions
Start-up expenses
Business operating expenses
Car Expenses
Business travel expenses
Meal and entertainment expenses
Home office business
Long-term assets deduction
Retirement plan deduction
Medical expenses
Advertising expenses
Education expenses
Other deductions