Wednesday, July 3, 2013

Small Business Accounting Expense Categories

Familiarity with small business accounting expense categories makes it easier for you to do your taxes. If you operate a micro enterprise, preparing your tax return is probably not your favorite thing. In fact, it is usually recommended that you get help from a tax preparer you can trust if your budget allows for that.


Image via 123RF

Whether you are doing your taxes yourself or not, it helps to know which expenses are deductible. It gives you greater peace of mind when you are planning or making decisions on a daily basis. For example, if you operate a farm and you want to get a small van to transport goods, you would want to make sure that you could list that as a cost associated with operating a commercial enterprise.

Expenses often fall in the following categories:
  • Commercial use of your home
  • Business use of your car
  • Retirement plans
  • Interest on loans
  • Necessary insurance
The Internal Revenue Service (IRS) in the United States makes it clear on their website that anything you buy must be necessary, for it to qualify. Necessary means that it is helpful and appropriate for your type of trade or service.