![]() This means you will want to stay on top of your chosen industry. Books, Literature and EducationĪs an S-Corp owner you are telling the world that you have an amazing product to share, either an item you are selling or your own skills. We also discourage placing the vehicle in the company’s name because this forces you to use actual expenses and is subject to verifying specific rules for asset disposition. ![]() This option is far easier for record retention. Then, using the Business Accountable Plan, we set things up so that you can have the standard mileage rate reimbursed to you through payroll. Here at Formations, we prefer to have you set up your automobile as a personal asset and track your business mileage. Don’t want to track mileage or put wear and tear on your own car but need to get around town to meet clients? That’s okay! You can also deduct the cost of a taxi, public transport, Uber, and Lyft. There are some amazing apps available to help track the mileage and, for the 2020 tax season, the business mileage rate is $0.575 per mile. The IRS allows you to deduct either the actual expenses, such as fuel, maintenance, and repairs, or the miles that you drive throughout the year. If you drive around to meet clients or pick up supplies and materials, this means you can now deduct your mileage and the business use of your car. Vehicle, Mileage, and Other Transportation ![]() Both the cell phone and internet expenses also fall under the new Business Accountable Plan as reimbursable employee business expenses. And, in today’s digital world, the cost of your internet is also a business deduction. You can either deduct the percentage used for business purposes or set up a separate line specifically for your business and deduct the cost of the added line. That cell phone that is always at your side or in your hand now serves a business purpose. Let one of your Formations team know that you are interested in this new savings vehicle and we can get you set up. The Business Accountable Plan is a relatively new tax regulation that you may not know about. If rather than utilizing space in your personal home, you pay rent for an individual office or time-shared space, you can deduct the cost of rent and separate utilities on your business tax return. Some of the allowed reimbursable expenses include property taxes, utilities, mortgage interest, and general repairs. A Business Accountable Plan allows your S-Corporation to pay you for the cost of using a home office and this is done as a tax-free employee business expense reimbursement through payroll. Now that you are your own boss you can take advantage of the Business Accountable Plan to deduct the expense of maintaining a home office. Well, as an S-Corp there are quite a few business expenses that you can take advantage of. So, you’ve taken the leap and upgraded your LLC to an S-Corp! Congratulations! Now you are probably wondering what expenses you should be keeping track of to maximize the tax benefits.
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