Every tax season, there’s a big focus placed on the latest deduction trends – what new big purchase from the year can help reel in the biggest deduction for a small business.
Now more than ever, small businesses and taxpayers in general are looking for greener options when it comes to tax deductions.Outside of the principle of being able to do some good while saving money, many entrepreneurs also run their businesses out of their homes and there are plenty of credits available that they might overlook otherwise. From fuel-efficient vehicles to growing trees, here’s a look at what green businesses can deduct this year on their tax returns.
Using your fuel-efficient vehicle for work
You can score some major deductions on using your car for work purposes. As stated by the IRS, the 2014 standard mileage rates for cars, vans, and pickup trucks is 56 cents per mile for business miles driven, 23.5 cents per mile driven for medical or moving purposes, and 14 cents per mile driven in service of charitable organizations.
A shortlist of the deductions available include driving anywhere from work to another work site, going to a meeting, or meeting a client. You can get that driving money back for parking fees/tolls, registering your vehicle, rental expenses, gas, insurance and maintenance. For more information about the credits available for electric vehicles and plug-in hybrids, check out the U.S. Department of Energy’s fuel efficient vehicle tax incentives information center.
This year, make those charitable deductions green
Publication 526 for charitable contributions lays out the organizations qualified to receive deductible contributions as well as examples of what is and isn’t a deductible contribution. One great option for companies of all kinds is to make a donation for old electronic devices. Maybe your business is updating its computers; by dropping them off, or even having them picked up, at a qualified charity organization such as Goodwill, you are preventing the mixing of hazardous materials with our landfills.
Deduct the very roof you work under!
Your own office may qualify for an Energy Efficiency Tax Deduction. Available for commercial property owners and leaseholders, this deduction can save you as much as $1.80 per square foot of your work building, if your building holds a 50% reduction in energy and power costs (i.e. if your office shows signs of energy efficiency in areas including interior lighting, heating, cooling, ventilation and hot water systems).
These energy-saving tools may be pricey to install at first, but they can save you and your business plenty of money in the long run – and a tax deduction can help you gain some of that installation money back.
Got a green thumb? That’s deductible!
Some states have obscure deductibles that, for the savvy business owner, need to be rooted out for extra savings. South Carolina residents receive $50 if they donate a deceased deer to the poor, and if you grow state-approved trees in Hawaii, you’re looking at as much as $3,000 in deductions! Scout out some of the lesser-known deductions available within your state – you never know what you’ll find that can apply to your business.
What green tax credits does your business qualify for? Let us know in the comments!
Deborah Sweeney is the CEO of MyCorporation.com. MyCorporation is a leader in online legal filing services for entrepreneurs and businesses, providing start-up bundles that include corporation and LLC formation, registered agent, DBA, and trademark & copyright filing services. MyCorporation does all the work, making the business formation and maintenance quick and painless, so business owners can focus on what they do best. Follow her on Google+ and on Twitter @mycorporation.