In the midst of tax season, small businesses are consistently trying to find ways to maximize their credits and deductions. If you are struggling with your taxes this year, check out these helpful tips to make next year’s tax season a breeze.

1. Keep Every Receipt

Go through your desk drawer, your car, your purse, and around your kitchen counter to gather all of your receipts. Get an accordion folder to keep every receipt in throughout the year or download an app, like Expensify, that allows you to take a picture of your receipts for future reference.

Save everything regardless of whether you paid in cash, credit card, or check. Record all of your transactions in a log from month-to-month that has the location of purchase, amount, and reason for the purchase. If you do this, it will be easier to keep track of all of your deducations at the end of the year and you will save yourself time scrambling to review a year’s worth of transactions.

2. Deduct Your Home Office & Car Expenses

If you are a small business owner that operates from office space in your home, you can deduct expenses related to that on your taxes. These expenses include mortgage interest payments, insurance, repairs, and Internet service. All you have to do is determine what portion of your home is dedicated to your business and submit that information.

There are two different ways you can include vehicle expenses on your tax deductions. You can either report based on the IRS’s standard mileage rate or your car expenses, such as insurance, gas, and repairs. Similar to using your home office as a deduction, you will need to determine what percentage of the time your car is being used for work purposes before you can write it off.

3. Register Your Business as an LLC

If you are a sole proprietor or a small business that is not currently an LLC, we highly recommend going through the process to do that. No business is too small to be an LLC and the distinction can help eliminate some of the self-employment taxes you are currently facing.

How Your Chamber Can Help

The North Charleston Chamber of Commerce is here for you and your business. If you are a brand-new small business this tax season or are just getting overwhelmed every time you look at your taxes, contact us. We will provide you with resources that can ease your headache and help you get back to what matters most – your business!