Wednesday, March 23, 2011

Five Tax Deductions You May Be Missing

Don’t miss out on important tax deductions that can bring savings to you this tax season.

You undoubtedly know about business-related tax deductions for your car expenses and home telephone expenses (such as long-distance phone calls and special phone services you use for business), but how about some of those lesser known tax deductions? Here are five that tax expert and author Stephen Fishman recently highlighted at Inman News.

1. Business gifts: Gifts you purchase for your customers are deductible as a business expense. The deduction is limited to $25 per person per year. Company-wide gifts, however, are deductible in any reasonable amount.

2. Continuing education courses: Those continuing education courses you’re required to take each year to maintain your real estate license can be deducted, as well as any education courses you take that improve your skill-set in your career (such as webinars). However, you can’t deduct the education expenses for starting a new career path, such as in obtaining a real estate license.

3. Greeting cards: Did you send a client a card to reach out to them and show them you care? Greeting cards you send to clients and prospects are deductible as an advertising expenses, says Fishman.

4. Web sites: Maintaining a business web site can get costly. You can deduct your business-related web site design and maintenance costs, as well as Internet hosting fees and the cost of getting a domain name for your business.

5. Business clothing with logos: Before you go on a clothing shopping spree, make sure you know what you can deduct when it comes to clothes. The business clothes deduction only applies to items with your company logo on it. While you can’t deduct a regular business suit, you can deduct the cost of a sport jacket or coat that boasts your company’s logo on it, Fishman says.

Don't forget: Tax returns are due by April 18 this year (a three-day extension was granted this year due to the weekend and holiday).

Source: “10 Tax Deductions: In Time for April 18 Deadline,” Inman News (March 18, 2011)

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