I am self employed, which means doing my taxes is kind of a nightmare already, but it becomes even more difficult when I have to consider all of the tax write offs and deductions that can help reduce my taxes to a rate that is easier to pay–which in this economy is almost necessary. Fortunately, I found a site that has some of the most common tax write offs, and I use it as a kind of check list that helps keep me organized. It reminded me to make sure to include my educator expenses (I am a private tutor for children who are trying to get into college, so I have to buy quite a few materials!), as well as the state sales tax, which cost you deduct from your federal tax. It also reminded me to deduct my non-cash contributions, of which there are many, as I am a charitable guy.
With the weak state of the economy in recent years, it is important to maximize every cent that you can. When you are doing taxes, one of the most important things to understand are tax write offs, as these can add a lot of money to your income if you understand the common principles. An example of a tax write off can be an expense in your business, which can total a large sum of money that you would not have to include in your earnings when you pay taxes. This percentage can greatly reduce your taxable income and save you a lot of money that you can put towards other ventures during the next year. Also, since most tax write offs will be a continuous occurrence, it is important to figure the ones that apply to your specific company as this will translate to extra money each and every year.