2023 year-end tax tips for inspectors

year end tax tips for internachi members gromicko

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Are tools we purchased throughout 2023 tax deductable? And what about adding and paying for ancillary services. Such as lead dust sampling that I offer. Paid for the course and my License to the EPA. Are they deductible?

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All of it is fully deductible as business expenses.

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A good question to ask when determining if something would be deductible:

Would I need to buy this if I did not have this business?

If the answer is no, it is very likely deductible.

Keep in mind, even if the answer is yes (you would have bought it even if you did not have the business), it may still be deductible. An example; you would probably buy a cell phone regardless, but if you use it in a substantial way for business, it can be a business expense.

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Thanks, smart way to look at it! Yea, I been saving all my receipts this past year if I purchased anything that I needed for the business.

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Bumpity bump.

Make your largest purchases the last week of 2023. Truck, tools, drones etc as a Section 179 expense. That way you dont have to prorate betwèen personal and company use.

Don’t forget about Self-Employed Retirement Plans. You can significantly reduce your taxes while saving for retirement. I use a Solo 401k. You can contribute the max employer and employee amount each year. This immediately reduces your tax burden for the contribution year (you will pay taxes upon withdrawal).

If you would rather pay the taxes now, there are options available for that as as well.

I use E*TRADE to host my Solo 401k. But there are many online brokerages out there that can do the same.

And your investment options are virtually unlimited, from very low risk, to higher risk. For retirement investments, I prefer Vanguard mutual funds that are based on your target retirement age. But I also like blue-chip stocks that pay a dividend, like Ford or 3M.

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Keep in mind, you can also max out your IRA contributions while maxing out your Self-Employed Retirement Plan at the same time. My wife and I max out our IRA contributions and put it all into the Vanguard 2035, 2040, or 2045 Target Retirement Funds. Very low investment costs and no need to pay an “advisor.” These funds are automatically managed for risk based on your target retirement age; at a very low rate relative to a personal advisor.

Invest early, invest often. Use your first dollars of profit to invest or save. Don’t plan to use your “left over dollars,” to save and invest, as that will never amount to a hill of beans.

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