Once you ve established your business, be sure to deduct every expense the law allows. You can deduct any expenses that are ordinary and necessary for running the business, paid or incurred in the tax year that you take the deductions. For example, you can delay billing clients until after the close of the year, or prepay expenses before then. Prepaid expenses are deductible in the year you pay them. Generally, you can t deduct for expenses that deliver value more than 12 months past the end of the in which you pay.
Capital expenses are assets or improvements with a useful life of more than one year.
Ordinarily you write off capital assets over their expected life through Depreciation . However, you can use First-Year Expensing to write off tangible personal property you acquire from unrelated individuals. You can establish a wide variety of benefit programs for yourself, your family, and your employees. Each month, we'll deliver proven tax planning strategies for investors, entrepreneurs, and families.