This discussion aims to shed light on a seldom asked but valuable question, aiming to provide business owners with a comprehensive understanding of their expense options.

 

Many business owners commonly opt for deducting the entire amount of an expense in a single year. However, it is crucial to note that if a particular purchase could be categorized as an asset, spreading the expense over multiple years becomes a viable option. This approach can effectively alleviate your tax burden over time. 

 

By strategically considering the classification of expenses, you can optimize your tax liabilities and better manage your financial resources.

 

What you’ll hear in this episode:

[1:25] Defining what an expense is in your business.

[1:56] Defining what an asset is in your business.

[3:00] The importance of spreading a purchase over multiple years, AKA depreciation.

[4:50] What is the safe harbor threshold?

[6:15] What are the benefits of you understanding assets vs expenses in your own business so you can help maximize your tax deductions?

[7:09] What are intangible assets in your business?

 

Resources:

* Find everything you need at https://www.keepwhatyouearn.com

* Questions about this episode? Text me!: https://my.community.com/shannonweinsteincpa

* Chat about this episode in the Keep What You Earn Community – http://keepwhatyouearn.circle.so/

* Hire us: https://www.fitnancialsolutions.com/accounting

* See how much you can save with an S Corp: https://www.keepwhatyouearn.com/keep-what-you-earn-s-corp-calculator

* Find me on IG https://www.instagram.com/shannonkweinstein/

* Meet me face-to-face on YouTube: https://www.youtube.com/channel/UCMlIuZsrllp1Uc_MlhriLvQ

* Featured in Yahoo Finance! Read more here: https://finance.yahoo.com/news/10-bookkeepers-accountants-watch-2021-113800161.html

 

The information contained in this podcast is intended for educational purposes only and is not individual tax advice. Please consult a qualified professional before implementing anything you learn.