5 Tax Deductions for Your Home-Based Business

5 Tax Deductions for Your Home-Based Business

In our increasingly digital world, many companies are choosing to incorporate remote workers and freelancers. As a result, more and moreentrepreneurs are cutting the commute and working from home. For those who own their own home-based business, there are many opportunities for tax deductions. If you run your business from home, here are 5 tax benefits even the savviest entrepreneurs sometimes overlook.

Expense a portion of your home

Because your working from home, your home becomes the office. Considering that overhead is one of the costliest parts of owning your own home, you’ll be glad to hear that it can be listed as a business expense. However, keep in mind that does not mean you can write off your entire mortgage payment and electricity bill, but you can claim a portion of it as an expense. You should speak to your accountant to calculate the exact percentage of home-related business expenses – rent, mortgage, insurance, electricity, etc. – you can claim.

Deduct home office repairs

Depending on your business type, running your business from home could lead to wear and tear to certain portions of your house. Fortunately, any repairs and upgrades to your workspace can be deducted as a business expense. This includes upgrades to furniture and equipment you intend to use for your business.

Write-off home office expenses

Similar to the home office write-off, you can also deduct a portion of your utility, internet and phone bills. Again, it is important to talk with your accountant to determine what percentage of these expenses you can deduct. You can also deduct the business supplies you buy (just be sure to hang on to those receipts).


As time goes by, things can decline in value and they get worn down. Since you are running your business from home, you can deduct the depreciation that applies to the portion of your house you use as a home office. This also includes any equipment or furniture used in your home office.

Merchant Cash Advances

Do you need to boost cash flow? Consider a merchant cash advance. Because a cash advance is not a loan – it is simply a pledge of future sales in exchange for an upfront lump-sum payment. They are not subject to taxes, since they are not reported as income. In addition, merchant cash advance fees may be tax-deductible under expenses. (Keep in mind the income used to pay merchant cash advances back are not tax deductible.)

With the end of the year fast approaching, make sure you are aware of the many tax benefits for home-based businesses. There are so many opportunities for tax deductions for small businesses run from home.

Author Bio:- As the FAM account executive, Michael Hollis has funded millions by using merchant cash advance solutions. His experience and extensive knowledge of the industry has made him financeexpert at First American Merchant.