You know very well that you have to shell out some of
your hard-earned money every time you have to file your tax returns for
your business. What is not known to many tax payers is that there are
many tax deductions out there that can lower the amount of tax that you
have to pay the government.
The first thing to consider in filing your tax returns is to determine
who will prepare your tax forms. You can do the preparation yourself,
aided by some tax software programs or by making inquiries with the
Internal Revenue Service, either through their website or over the
phone. You will realize that it will be very easy to handle the
preparation aspect of your tax returns to be filed. Another option is
availing of the services of professional tax preparers, like H&R Block
and many other professional tax service providers. While the service of
professional tax preparers may cost a little bit more money than when
you do it yourself, you will discover that they can find tax deductions
for you that you are not aware of.
Many owners of home daycare centers are surprised to learn that mileage
logged in the course of the operation of the business is tax deductible.
One will be missing huge savings on taxes paid by not keeping track of
mileage. Deductible mileage includes those logged for field trips or
trainings and any other trip you made in relations to the operation of
your daycare center. Every grocery trip to purchase food for the
children, every trip to the bank to deposit checks paid by the parents
of the children under your care, every trip to buy toys and supplies
needed by the children are deductible mileage from your tax.
How can you claim mileage deduction if you failed to keep track of them?
You can create your mileage log by reviewing every receipt that you
kept, also for the purpose of tax deductions. Arrange the receipts by
date then calculate the number of miles traveled from your house to the
place where the receipt was issued and then back to your house again. If
you are not sure of the actual distance covered by each trip, you can
you MapQuest to establish the distance from your home to the store where
you made the purchase. A 10,000 miles total can easily translate to
between $3000 -$4000 deduction. It is not a small amount of money!
Another big tax deduction comes from the food supply you purchased for
the children in your daycare center. You need to calculate the total
expenses on food incurred by the daycare center for one whole year,
separate from the personal consumption made by you and the members of
These are only two examples of top deductibles that can give you tax
savings. A lot more deductions can be availed of if only you know what
are they. A tax professional can easily identify those tax deductions
and help you prepare your tax documents.
You will realize at the end that the amount you paid your tax
professional will be worth the tax payments that you can save.