The tax law provides options for Illinois small business owners

Tax time is once again upon us, and Illinois small business owners receive some tax advantages not available to larger businesses. For many business owners, one of the advantages is the ability to work from home. The tax law acknowledges and accounts for this fact.

For instance, a tax law allows for the deduction of a home office. Of course, as with any other tax deduction, certain criteria must be met in order to use this deduction. Operating out of the home is not unusual for many owners of small businesses. This is the place where the day-to-day running of the business takes place. It only makes sense to be able to deduct at least a portion of the expenses associated with having a home office from an owner's taxes.

The area of the home where business is conducted must solely be dedicated to the business. Household bills for the square footage of the home office, such as mortgage or rent, electricity and maintenance are some of the annual expenses that can be apportioned to a home office. The tax deduction even accounts for the need to remodel a home to accommodate the business.

This is not the only tax law available to Illinois small business owners, but it is a popular one. Finding other possible deductions could be complicated and frustrating without a working knowledge of the tax code. Some small business owners get into trouble when they attempt to take deductions without fully understanding whether they are entitled to them. It may be beneficial to seek out assistance when it comes to preparing tax returns to make sure all of the available deductions are used, and so that deductions are not taken by mistake that could result in additional tax liability.

Source: The Huffington Post, "Tax Tips for National Mom-and-Pop Business Owners Day", Mark Steber, March 27, 2014

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