Ryan covers the basic rule for business tax deductions: any expense directly tied to sustaining, growing, or researching your business is deductible. Personal groceries, rent or mortgage on your primary residence, and entertainment expenses are not. Pay deductible expenses from a business account to document them clearly.
Hey, in this tip I wanted to go over general rules when it comes to business tax deductions. So we look at it this way, if you're spending money and it's related to your business, whether to sustain it, to grow it, to research new ways to improve it, all of those things, then it's Likely a tax deduction, you need to look at it. One expense that for sure, 2 expenses, sorry, that are for sure never tax deductible, personal groceries. So if you got audited and they see that every single grocery charge is paid out of your business and you tried to write it off, that is not going to fly. Personal groceries are never a tax deduction. Also payment for your primary residence. So if you're renting from a landlord or if you're paying a mortgage, those are never business tax deductions. You can write off your mortgage interest as a personal itemized deduction if you choose to itemize, but it's not a business deduction. As of tax reform of 2018, entertainment related to your business is not a tax deduction anymore. Golfing, sporting events, just entertainment, movies, they're just, they're not tax deductions anymore, sorry. They made up for it in other ways, but yep, entertainment, gone. Yeah, so that's the general rule we look at. If you're spending money, ask yourself, is it related to your business? And then if it is, then write it off. Pay for it out of the business account, of course, so that it's a stronger proof that it is in fact a business deduction. If you ever have any questions, feel free to use us as a resource. And of course, if you liked this tip, please subscribe and please share with others. We want to get the word out. Okay, have a good day. Thanks, Ryan.
