| If you run a business, you are looking for as many | | | | unemployment and Medicare taxes you actually paid |
| deductions as possible to knock down the tax you | | | | on employees. |
| have to pay. Following are some highlights of the | | | | 3. Self-Employment Tax - The self-employment tax is |
| taxes you can deduct that are collected by anyone | | | | a whopping 15.3 percent. It can be an ugly surprise if |
| other than the federal government. | | | | you are not ready for it. Fortunately, you get at least |
| How confusing is the tax code? So incredibly | | | | some relief with a deduction. Yep, you can deduct 50 |
| confusing that you can actually claim a deduction for | | | | percent of your self-employment tax on line 27 of |
| the taxes you pay to one tax agency, but not another. | | | | Form 1040. |
| In this case, we are talking about what tax payments | | | | 4. Personal Property Taxes - If your state collects a |
| businesses can deduction on the federal tax returns. | | | | property tax on personal property you also use for |
| The simple answer is you can deduct some of the | | | | business purposes, you can claim a deduction. The |
| state and local taxes you pay through the year. Let's | | | | deduction is equal to the amount of the tax times the |
| take a closer look at small business owners that figure | | | | percentage of the time you use the property for |
| their tax on Schedule C. | | | | business. |
| 1. If your state and/or local government collect income | | | | 5. Real Estate Taxes - If you own real estate used for |
| tax from your small business, you can deduct the | | | | your business, to wit, your own office building, you can |
| amount that is attributable towards your business | | | | deduct state and local real estate taxes. Such taxes, |
| effort on Schedule C. Other state and local taxes | | | | however, have to be based on the assessed value of |
| have to be deducted on Schedule A, but only if you | | | | the property. |
| itemize. | | | | Depending on your business, there may be other |
| 2. Employment Taxes - If you have employees, you | | | | deductions you can claim for state and local fees. |
| know the joy of paying employment taxes. Well, you | | | | Issues such as excise taxes and disability fund |
| get to deduct them once it comes around to tax time. | | | | contributions can be complex, but worth checking out |
| Specifically, you can deduct social security, | | | | to save a few bucks. |