• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer
  • HOME
  • ABOUT

The Fortunate Investor

Investing, Business, Saving, Debt, Money, Retirement

  • Business
  • Invest Your Money
  • Save Money
  • Get Out of Debt
  • Make Money
  • Family & Money
  • Taxes
  • Retirement
    • Retirement Calculator
You are here: Home / Taxes / Helpful Tax Tips for Modern Home Business Owners

Helpful Tax Tips for Modern Home Business Owners

January 20, 2020 By The Fortunate Investor | This article may contain affiliate links. For more information visit our Disclosure

Helpful Tax Tips for Modern Home Business OwnersRunning a business from home has several benefits.

However, failure to plan and prepare for filing taxes can easily offset these.

Two major reasons home businesses fail are time and dedication. It’s easy to underestimate the time it takes to start a home business, and working at home brings many distractions.

The additional “job” of tax planning shouldn’t be the proverbial “last straw,” though. Keep reading for some tax tips that will save you time.

Table of Contents

  • Home Business Tax Tips
    • Understand the Tax Code as It Relates to Home Businesses
    • Establish a System for Keeping Records and Tracking Expenses
  • As Tax Time Approaches…

Home Business Tax Tips

With a home business, preparing for taxes involves grasping what filing business taxes entails—plus meticulous record-keeping and organization.

Consider these tips.

Understand the Tax Code as It Relates to Home Businesses

Go to the IRS Small Business and Self-Employed Tax Center, a directory of tax publications affecting small or home-based businesses in the U.S. This will help with planning and organization.

The most common home business deduction is for a home office.

Be aware, though, that taking this deduction requires a lot of detail and documentation. Some other deductions are available, too.

They are:

  • A home office deduction can be taken for certain home-related expenses. It’s critical to demonstrate that part of your home is your primary place of business. If your space and its use qualify, you may deduct things like mortgage payments and use of your personal vehicle
  • Startup expenses include the costs of starting your home business. Pre-opening costs might include a business plan, research expenses, borrowing costs, or technology. Post-opening costs might include advertising or promotion, and any outside services
  • For other business expenses, you may deduct such things as retirement plans, use of a personal vehicle, meals, office supplies, marketing, and professional services

Since some of these expenses could be for personal as well as business use, you must keep receipts and records to justify your claim.

Establish a System for Keeping Records and Tracking Expenses

Consider this record-keeping wisdom: “If you want to deduct it, you will need to prove it. It can be inconvenient to save this much paperwork, but you will be grateful come tax time.”

There are many records you should keep.

First, develop a good filing system.

This system should begin with a small folder or another portable container for receipts and other paperwork while you’re away from your office.

You should file documents according to type—for example, receipts for dining and/or travel, auto maintenance and repair, office supplies, etc. If you use several professional services, have a folder for each.

Next, consider a good financial software program.

There are several great software programs for small business accounting. Most are available online by subscription—so they’ll stay updated.

One of these is QuickBooks. If you need help learning it, contact an assistance business like QuickBooks ProAdvisor. Don’t lose time trying to figure it out when you can get help!

As Tax Time Approaches…

As Tax Time Approaches

We hope these self-employed tax tips are helpful for your home business.

There is still one more piece of advice we should offer: don’t go it alone if you don’t need to.

Starting and running a home business can be challenging, especially when it comes to taxes. However, there are plenty of tax professionals to help you navigate taxes for home businesses.

What you pay them might save you money in the long term. It should at least save you some stress. It’s not that you don’t understand taxes, but these people study them every day and keep up with any changes.

If you’d like to read more about business and other financial matters, keep reading our site.

Primary Sidebar

Popular Articles

How to Financially Prepare When a Loved One Needs Bail

How to Financially Prepare When a Loved One Needs Bail

No one talks about how financially draining it can be to help someone you love get out of jail. It’s … Read More about How to Financially Prepare When a Loved One Needs Bail

What To Think About When Starting A Law Firm

What To Think About When Starting A Law Firm

Getting your law degree is a big accomplishment. What’s even more ambitious and rewarding is wanting … Read More about What To Think About When Starting A Law Firm

Mastering Work-Life Balance in a High-Speed Office World

Mastering Work-Life Balance in a High-Speed Office World

Work Life Balance Overview In today’s fast-paced world, achieving a balance between work and … Read More about Mastering Work-Life Balance in a High-Speed Office World

Beyond Allowance Teaching Teens to Manage and Grow Their Money

Beyond Allowance: Teaching Teens to Manage and Grow Their Money

Teenagers get a tough time of it in many circles these days, accused of any number of moral … Read More about Beyond Allowance: Teaching Teens to Manage and Grow Their Money

Tree Care Tips All Homeowners Need to Know

Tree Care Tips All Homeowners Need to Know

Homeowners with trees on their property will understand the importance of ensuring they're healthy … Read More about Tree Care Tips All Homeowners Need to Know

Footer

TOPICS

SAVE MONEY
INVEST MONEY
REDUCE DEBT
MAKE MONEY
FAMILY & MONEY
TAXES
START A BUSINESS
RETIREMENT

THE FORTUNATE INVESTOR

ABOUT US
ADVERTISE
CONTACT US

The Fortunate Investor focuses on personal finance topics to build wealth. Topics include saving money, investing, managing debt, family and money, taxes, making money, college planning, starting a business, coupons and retirement.

SOCIAL MEDIA

FACEBOOK
TWITTER
PINTEREST
YOUTUBE

Copyright © 2025 Fortunate Investor. All Rights Reserved. | Disclaimer & Disclosure | Privacy Policy | Terms of Service