write-off of up to only $500,000. This includes computers, vehicles and machinery.
If you have the capital or can borrow to improve your business, this is a great time to update your technology with new servers, workstations, desktops or laptops. To consider your options, Dell Small Business advisors are available to answer your questions and offer you advice, no matter the size of your company. Engage the team in a live chat on Dell's Small Business website to find the right solution for your needs.
Self-employment deductions
For the independent contractor, expenses such as education fees directly related to your business or personal health insurance costs may be deductible. This may be a good time to take a course to improve your skills or knowledge. See the self-employment section of IRS.gov.
Qualified business income deduction (QBI)
The QBI (Section 199A) allows eligible sole proprietorships, partnerships, S corporations, plus some trusts and estates to deduct up to 20 percent of their qualified business income, plus 20 percent of qualified real estate investment trust (REIT) dividends and qualified publicly traded partnership (PTP) income. Section 199A of the Internal Revenue Code provides many eligible taxpayers with a deduction from a qualified trade or business operated directly or through a pass-through entity (such as an LLC). QBI is the net amount of qualified items of taxable income, gain, deduction and loss from any qualified
trade or business. Items such as capital gains and losses, certain dividends and interest income are excluded. Income earned through a C corporation or by providing services as an employee is also not eligible. See the IRS website for a complete explanation of QBI.
Consult a tax professional to see if it would benefit you to register your business as an LLC or an S-Corp. Whether the financial benefit would outweigh the cost will vary, depending on your situation.
Employee-related expenses
You may be able to deduct expenses such as retirement plan contributions for your employees, even if you have very few. If you've considered hiring employees or increasing your staff, this may be a good time to do it. You will also be able to deduct wages paid for an employee while they are on family and medical leave. See the self-employment page at IRS.gov.
Beware of changes
Entertainment expenses are no longer deductible, though most business meals are allowed (see Publication 463 of the IRS). Business meals are 50 percent deductible. So, plan dinner with your clients or business partners, but skip the entertainment.
No matter what type of small business you own, consult a tax professional to avoid costly mistakes and increase your tax savings. Plan ahead for next year's taxes by using the latest technology to keep accurate records of your income and expenses all year.
medicine when they're sick?
BUSINESS MATTERS