Tax day is creeping up on us once again. And if you are like most photography business owners, filling out tax forms are anything but a fun time. Whether you do it yourself, or hire someone else to do it for you, nothing can make the experience a little more bearable is seeing the word “refund” instead of finding out how much more you owe.
With thousands of pages of code and a plethora of changes that occur every year, its easy to miss things that could impact your bottom line. Check out these commonly overlooked deductions to see if you qualify for more this year.
1. One of the most overlooked credits is the American Opportunity Credit, which has been extended through 2012. This credit allows eligible taxpayers to claim up to $2,500 for each of the first four years of college for each student. Whether you or a child is currently in college, this credit is nonrefundable, which means you could get back more in a refund than you paid in.
2. Have you donated anything to charity this year? While you’ve probably cleaned out your closets a time or two, don’t forget about the things you’ve donated for your business as well. A donated portrait session still has value.
3. Mileage can be a huge bonus to your bottom line. In many cases, you probably use your car for personal and business. Everything business related can be deducted. Also include volunteer mileage as you are driving to and from charity functions. While you do have the option for reporting actual expenses or taking the mileage credit, the mileage credit is usually the easiest way. Keep a log handy in your car and record everything you do for business. [Read more...]