There are many benefits that accompany working for yourself. Some of these include being your boss and setting your hours. However, you will have to pay for your own health insurance and consistently work to find your jobs. The key to reducing your income tax payments will largely rest on some deductions you're able to claim. The good news there are several of these that can decrease your taxes if you're self-employed and know what these can be helpful to you.
Deduction #1: Health insurance
Keeping your medical coverage up-to-date is one of the best ways to avoid a financial disaster if you have a major medical problem. However, the costs of coverage can be extensive if you're self-employed.
One of the major tax deductions for this group of individuals is your health insurance. You can deduct the full amount of this you pay each year from your gross income.
Deduction #2: Office space
It's possible you may have a space at your home you work from each day. This is sure to be your designated location for getting your work done.
This is referred to as your office space, and you can deduct the square footage of this area from your income taxes. Of course, there is a particular formula that must be used to do so, and your accountant will know exactly what this is.
Deduction #3: New purchases
Did you need to buy a new laptop or phone for your business? What about a printer or copy paper to keep your office going on a daily basis? All of the things you have to pay that are necessary to keep your company running may be deductible.
Many of the items you need for your company can be deducted from your actual income, and this simply adds up to fewer taxes for you to have to pay. Be sure to keep receipts of all the things you buy, so you will have these if you're ever audited.
Additionally, all of the services you use to keep your business going can be deducted, as well. For instance, if you pay for Internet and phone, you can use these as deductions.
Taking time to pay less each year for your taxes should be high on your list of priorities. You can achieve this goal by finding the right income tax services provider to assist you in making this happen so schedule your appointment today! For more information, contact companies like Lombardo Wagner Ayers & Company, LLC.