When times are tough, every last dollar you can keep is important. In addition to looking at your overall business expenses, you should make sure you are taking full advantage of all tax deductions available to you. Here are some suggestions for keeping more money in your pocket.

Home office deductions are available if you operate your business from your home and have no other primary location. To calculate the deduction, take the square footage of your house, and then measure the part of the space that is used regularly and exclusively for your business (no shared use allowed). If 15 percent of the space is used for business, then you can deduct 15 percent of the home expenses, such as real estate taxes, mortgage interest, rent, utilities, insurance, painting and repairs, as well as depreciate 15 percent of the structure. (Check with your accountant about how to handle the garage, storage shed, driveway and parts of the yard if you use them exclusively for business.) One hundred percent of furniture and equipment used solely for business is deductible. Remember, the deductions are available even if you rent your home instead of own it.

Transportation

Automobile deductions are available on your truck that you use exclusively for work, but what about the car you use part time? If you maintain a vehicle-use log to determine the percentage used for business, then that percentage of the car’s expenses as well as depreciation can be deducted. If your spouse is using another car to run business errands, have them keep track of the miles. Write down your mileage at the beginning of the year and then keep the log in the car.

Health insurance premiums are deductible to you and not included in the taxable wages of you or your employees if you have a qualified plan. Don’t assume that contribution to the plan will cost too much money. The overall tax benefit may exceed the additional cost. And providing healthcare may attract better employees to your business. Check with your medical insurance agent to see how many employees must participate in order to have a qualified plan.

Meals and entertainment are only deductible at 50 percent of cost, but half is better than nothing! Do you take customers, vendors or employees out to lunch or dinner, to sporting events or to play golf? Save those receipts and write down the business purpose of the event.

Family Members