The short answer:  probably not!

 

This is a sentence I hear at my tax desk every year, “I bought this for my business or I did that for my business but I’m not going to claim it because I have too many deductions!”   Seriously?  No you don’t.

 

I guess I should back track a little on this—if you’re claiming stuff you shouldn’t be claiming—that’s another story.  But if you own a business and you have a legitimate business expense—then claim it.

 

Often times, small businesses, especially in the beginning, have losses.  On your tax return it’s called a net operating loss or NOL.  If you have an NOL, you carry that back two years and use it to offset income that you had two years ago.  If you still have a loss, you can carry it forward for another 20 years!

 

Now sometimes you have an expense that gets limited if your business doesn’t have enough income—like a section 179 deduction or a home office expense.  That doesn’t mean that you can’t claim these things, they just get carried forward to be used to offset your future income.

 

Don’t skip your deductions!  I can’t stress this enough.  Often, at the “big box” stores, they’ll skip your home office deduction because they’re “saving you money by not claiming it” since they charge you for each form.  But it’s like that old expression, “pennywise and pound foolish.”  Sure, you save a few bucks by not filing the 8829 form, but you just lost the carry-forward of a few hundred dollar deduction.  This is especially important this year with taxes most likely going up next year.  Even if your deductions won’t help your tax return right now—do not just leave them off.  Otherwise, you would have to amend your prior returns to carryforward the deductions which will cost even more money in the end!

 

It’s still November, you have plenty of time to round up your receipts, review your mileage log, and make sure that you’re doing everything you need to be doing to maximize all of your deductions.  Obviously you can’t claim stuff that’s not a real business expense.  But you can claim everything that is a legitimate expense for your business.  Not only can you claim it—it’s the right thing to do.

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For those of you who do not have a home office, these posts will help get you started:
http://robergtaxsolutions.com/tag/home-office-deduction/
http://robergtaxsolutions.com/2011/07/how-to-boost-your-home-office-deduction/