Business Expenses List to Learn for Taxpayers and Small Businessmen

Business Expenses List to Learn for Taxpayers and Small BusinessmenIt doesn’t matter what type of business you are running now. What matters is you can get as many profits as possible. Learning the possible business expenses list to deduct when filing a business tax is a must.

business expenses list

Business Expenses List

The aim is to reduce the amount of money you need to pay for the taxes. By understanding the list, you can deduct as many as possible and save tons of cash. There are tons of expenses to deduct. Here are some of them:

1. Business gifts

All gifts you gave to customers or clients are deductible when it comes to paying taxes. However, the amount of deduction is only $25 each year for any business gifts given to a single client.

2. Bank fees

Your business credit card or bank account is useful to deduct several fees, including overdraft, funds transfer, and service fees. This rule also applies to transaction fees or merchants paid to third-party payment processors.

3. Wear and tear bonus

Until now, business owners are able to reduce the whole cost of eligible properties. The business expenses list even includes computer software and plants that grow nuts and fruits!

4. Insurance premium

What is included in this type of business expense? These include premiums paid for business vehicles, professional malpractice, interruption, and worker’s compensation. Others are life, vision, dental, and health insurance premiums for employees.

Also read : Business Expenses List to Learn for Taxpayers and Small Businessmen

5. Business meal

Business owners can reduce about half of the cost of eligible drinks and food. What does it mean by eligible? These expenses should relate to your business activity. For instance, you need to pay for expensive foods when meeting and discussing a business with clients or business partners.

READ ALSO :   What You Need To Know About Capital Gains Exemption In 2023

This also applies to meals for employees who involve in it. The amount of deduction can be as high as 100% if the foods or drinks were served at office social events.

6. Health insurance

This one is specialized for a self-employed or independent contractor. You can reduce the expenses of your personal health insurance premiums. However, there’s the qualification.

For instance, the business should be in a profitable status during that tax year. Also, you must not eligible for an employer’s health plan.

7. Business vehicle

The overall expense of operating your vehicle can be deducted from the business expenses list as long as it is meant for your business only. Thus, don’t use the vehicle for personal purposes if you want to qualify for this type of deduction.

8. Marketing and advertising fees

All businesses need to grow well. Marketing can help your business to grow bigger over time, but it indeed costs lots of money. The good news is advertising becomes the subject of deductions.

These include the costs of business printing, logo design, advertising space, social media marketing campaigns, promotional letters, event sponsorship, and many others.

One thing, you cannot reduce any marketing costs you incur to sponsor political events or campaigns on behalf of your business.

9. Philanthropic contributions

As a business owner, you have the opportunity to deduct the cost of contributions. However, the donation should be given to a qualified organization only. Companies and corporations can reduce these expenses up to a quarter of their taxable income!

10. Dependent care

There is a qualification to get this type of cost business expenses list deduction. The person who receives your money or support should be under 13 years. These include other dependent relatives or spouses who are unable to care for themselves mentally or physically.

11. Contract labor

The good news is any payments to independent contractors and freelancers are deductible. You only need to send a 1099-MISC form to those people who deliver more than $600 worth of services to your business in any tax year.

12. Goods sold expenses

This one is tricky. This doesn’t mean you can deduct the cost of your business inventory items. Instead, you can deduct the gross receipts from inventory items sales. Make sure to understand the concept before claiming for the deductions later.

READ ALSO :   What Is Irs Form 8962 And How To File It In 2023

13. Depreciation

The tax reform has brought happiness to business owners. You can now write off the whole expenses of new purchases of products like furniture, computers, and equipment.

14. Janitorial services and cleaning supplies

Business owners can deduct this type of cost, which relates to keeping their business sanitized. These include janitorial services, trash removal, cleaning supplies, sanitation, and recycling services.

What about the home office? There is a portion of deduction in the business expenses list and it would be calculated based on the size of the office.

15. Education

According to the IRS, all business owners have the ability to reduce costs or expenses related to education or training that helps to enhance or maintain business skills and expertise.

How to Track Business Expenses List

As the owner of a business, you must be able to track expenses properly. This ensures your business runs well and helps you to pay taxes accordingly. Not to mention this helps you manage cash flow better.

Here are some methods you can use to track those costs better:

Don’t mix personal and business expenses!

Rule number one is to keep business and personal costs separate. It must be done from the very beginning. By doing this, you won’t get confused with those two. Make sure to set up a separate business checking account, credit card, and savings account.

Knowing what counts as a business cost

It will be helpful if you know what counts as a business expense and what does not. This way, you can determine which one to deduct when paying taxes. If you are not sure about it, you can talk to a professional. These include a tax attorney and accountant.

Save receipts and record any transaction

One of the best ways to track business expenses list easily is by recording any transactions ASAP. These include a credit card purchase, online purchase, a check, cash, and many others.

This way, you won’t lose any track or forget the details. These records are useful when it comes to an audit and other tax-related purposes.

Hire a bookkeeper

This one is the best. If you find other methods are challenging and troublesome, hiring a pro is the real solution. Not only this person can track business expenses professionally, but he also provides advice to you.


The business expenses list is meant to help business owners to keep track of their business transactions and file deductions when paying taxes. Knowing all of them is recommended, but some important costs have been mentioned above.


Check Also

IRS Accepting Returns

IRS Accepting Returns

IRS Accepting Returns. The Internal Revenue Service (IRS) is the federal agency responsible for administering and …