You can’t entirely avoid taxes but you can reduce your tax liability. The best practice for reducing your tax liabilities is to manage your business expenses. You pay a 15.3% self employment tax on the profit that you make in your business. So your income less your expenses equals your net profit. Which means the more you write off ( business expense ) the less you pay in taxes. So here are a couple things you can do as a small business owner to reduce your tax return.
Keep all business receipts
Keeping your receipts help you not only remember your business expense but to also justify your business tax deduction.
Keep track of mileage
There is a small deduction you can take on your taxes with mileage. You can take the standard mileage deduction or itemize mileage deduction but both require you to keep track of your business mileage.
Cell Phone Write off
Many people use their cell phone for personal and business use. Because of this they usually do not include this expense on their business expense. For tax purposes you can figure the percentage of business use and write it off as a business expense.
So don’t try to find a way to avoid taxes but find a way on how you can reduce your taxes. There is no way you can fully avoid paying taxes to the IRS. That is illegal and can get you in trouble.
Finding a trustworthy reliable accountant to keep your books and to provide you with the best tax deductions can be hard. If you want to know more about my bookkeeping services schedule a time for us to speak and lets talk soon.