Depending on your profession, you may have significant expenses associated with your home office; it could be a yoga studio, a place to store expensive equipment, or something else altogether. Is your Coeur d’Alene home office space is used only for work, and it is your primary place of business? If so, there are multiple options for calculating your Coeur d’Alene independent contractor tax deductions in this category. There are direct expenses to consider, like renovations and a paint job, as well as indirect expenses, like insurance, utilities, property taxes, and home repairs.
For Coeur d’Alene self-employed entrepreneurs in today’s marketplace, continuing education is crucial. While coursework can get expensive, all educational expenses are potentially tax-deductible! Webinars, business-related books, and subscriptions to professional publications are all included here as potential Coeur d’Alene deductibles on your 1099.
Depreciation of Property & Equipment
As an independent contractor, you’ve likely purchased property and equipment for your business. Over time, those items lose value; a printer you bought three years ago is worthless now than it was when you purchased it. That’s called depreciation. According to the IRS, if business purchases will last you more than a year, you can write off the depreciation of their value on your tax return. Repairs on the property used for your Coeur d’Alene business can potentially be deducted as well.
Some Coeur d’Alene self-employed contractors refer to their car as “their office” since they spend so much time there, going from job to job. Car expenses and mileage can be one of the most significant tax write-offs for these entrepreneurs. Look into the standard mileage rate to figure out the best method of deducting your car expenses. The rules for calculating the SMR are updated every year, so it’s good to stay current. Tolls and parking are also deductible–for extended meetings or projects; these can add up to a significant out-of-pocket expense for an independent contractor. Keep your receipts and add them to your 1099!
Do you have client meetings out of state, or attend industry conferences? When it comes to business trips, your airfare, hotel costs, and 50% of your meal costs can be written off as Coeur d’Alene business expenses. Even if you extend your trip to travel after the CDA business commitments have ended, you can include those travel costs to make sure that the amount of leisure days on the trip doesn’t exceed the total amount of Coeur d’Alene business days. For example, if you fly from California to Paris for a 3-day photography conference, you may want to extend your trip for two days of touring. 50% of the costs of meals and accommodations for the extra two days can be deducted, just like the first three days.
Do you have one cell phone for both personal use and Coeur d’Alene business? If so, you can write off a portion of your monthly cell phone bill. Similar to your home office, you’ll want to determine what percentage of your phone usage is Coeur d’Alene business vs. personal. You can then deduct that percentage of your phone bill on your 1099 form.
100% of your health insurance is one of the many Coeur d’Alene deductible expenses for CDA independent contractors to include on your 1099. In addition to health insurance premiums, expenses such as glasses, nonprescription medications, and visits to the chiropractor can be written off. There may be benefits for your spouse, as well:
Jose hired his wife, Liza, to take care of administrative tasks associated with his auto restoration business. Thanks to Liza’s employee status, Jose was about to provide her with family health care coverage through his Coeur d’Alene business. Her coverage, like his, was 100% deductible.
To fully focus on your business, you’ll need great contractors’ insurance. Having Coeur d’Alene contractor’s insurance can save you money in many ways, and that includes your 1099. Business insurance is one of the CDA tax deductions for contract workers!
There are lots of benefits to be a Coeur d’Alene self-employed contractor, and a qualified tax advisor can help you optimize your strategy when filing your CDA 1099 independent contractor income tax deductions. While hiring a tax advisor may seem like an unnecessary cost, the help they provide may save you valuable time, and you can write off their fees as a Coeur d’Alene business expense.