Too Many Summer Expenses? Don’t Miss These Deductions!

Let’s be honest – with Summer here, neither of us wants to think about filing taxes. But being mindful of the upcoming tax season is beneficial in the long run.
You can take advantage of some tax deductions this Summer; all you need to know is where to look and how to claim. Here are a few business and personal tax write-offs you can utilize while enjoying fun in the sun.
Summer Vacations
Before you go planning a “vacation to end all summer vacations” to deduct costs, you must understand there are specific rules that go along with a tax claim like this – it’s best to view it more as a business trip than a full-fledged vacation.

  • Any huge, unreasonable, or personal expenses are not deductible
  • Travel costs are eligible as long as the primary reason for the trip is business related
  • You can only deduct expenses directly linked to the business portion of the trip – family expenses can not qualify

A local tax professional or CPA can assist with finding the typical and necessary expenses eligible to claim from business trips.

While kids spend the entire Summer without having to be anywhere, you – on the other hand – still have to work and may need someone to watch your children while away. You can write off the costs of daycare services by meeting these conditions:

  • Paid care for your child cannot come from a spouse or a dependent
  • The child cared for is a dependent and has lived with you for at least six months
  • Even if the child sitter isn’t a dependent, they must be at least 19 years of age to be paid for child care services
  • Your use of daycare services are so you can work or search for work – any other reason is invalid for tax deductions

Check out our informative, easy read blog for more details about child care tax credits:
Tax Tips for Child Care this Summer

Energy Efficient Appliances
On the Energy Star website, there is a list of appliances that are eligible for tax credits that range from roofs to central air conditioning to windows, doors, and skylights. This deduction serves as a significant plus for those of you who initially planned to install an energy-saving appliance regardless of knowledge about any tax credits. You can find out more about the Residential Energy Efficient Property Deduction from the IRS website.

Business Entertainment
Summer is the perfect time to host company events like barbecues, retreats, and parties. And each has the potential of writing off the entire cost! Be sure to maintain detailed records that prove the event was work-related. Expenses should be ordinary and necessary – not extravagant. Be prepared to report the business purpose, date/place of entertainment, amount of each payment, and business relationship of attendees.

You can find more information with another of our blogs: Holiday Party Tax Write-Off

Seasonal Employees
By hiring summertime workers, you can slash your tax bill as a business owner. Based on the Work Opportunity Tax Credit, you could qualify for a deduction of 40%, or up to $6,000, of first-year wages from employees federally recognized as one of nine target groups that face significant difficulties in securing employment.

If the employee has enrolled in long-term family assistance, the credit can increase up to $10,000 of first and second-year wages. Also, with any 16 or 17-year-olds you hire living in an “empowerment zone, enterprise community, or renewal community,” you can claim up to $40 of the first $3,000 of wages paid.

Each person tax situations are different – we can’t stress enough to seek a tax professional and find out exactly how these tax credits apply to you. And if you think you’ve waited too late to report all your deductions, has you covered!

E-file a personal or business tax extension and automatically get up to six extra months to file your tax return. It’s quick and simple, and your IRS Form 4868 or IRS Form 7004 is approved in just minutes!

Call our live, US-based team of helpful, e-file experts for any questions or assistance with the e-filing process. Reach out to us at 803.514.5155, Monday through Friday from 9 a.m. to 6 p.m. EST. And don’t forget to contact us anytime – day or night – with [email protected].

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