Skip to main content
Tax DebtTax Tips

A Look at Some of the Tax Benefits, Deductions Available to Self-Employed Individuals

By June 24, 2016No Comments

Making the decision to venture out on your own and work for yourself can be an exciting, yet frightening prospect. Nevertheless, it is important for those who are self-employed to know and understand the tax implications associated with such a decision. Sure, self-employment can mean taking on a number of risks — but there are a number of benefits and tax deductions available as well.

According to Investopedia, one thing is abundantly clear: If you own your own business, you should make sure you claim each and every tax deduction for which you qualify. Maximizing your tax benefits and deductions while minimizing your costs directly affects the profitability of your venture.

That said, self-employed individuals are encouraged to review the following short list of tax deductions and benefits and seek quality Boca Raton tax debt help to ensure that all possible options have been exhausted.

Have a Home Office? Take Advantage of the Home Office Deduction

In recent years, more and more individuals have decided to start their business from the comfort of their homes. The home office deduction, while it can be complicated, can prove to be quite beneficial to your bottom line when it comes to your overall tax obligations. There are two options for calculating home office deductions: the simplified method and the standard method.

The simplified method requires individuals to multiply the square footage of the home office by a rate currently set by the IRS at $5 per square foot. However, to use this method, the office cannot be bigger than 300 square feet and you will not be permitted to deduct related depreciation.

The standard method permits individuals to deduct a pro-rated amount of actual expenses related to the home office, including things such as property taxes, utilities, maintenance of the home, mortgage interest and more.

Deduct Your Health Insurance Premiums

Self-employed individuals who pay for their own health insurance out-of-pocket (and are not eligible to take part in a plan offered through a spouse’s employer) can deduct all of their dental, health and eligible long-term care insurance premiums. You are also entitled to deduct premiums paid for covering your dependents and spouse.

Business-Related Meals and Entertainment Can Be Deducted…Be Careful Though

If you are traveling for business and/or entertaining clients, the related expenses are tax deductible. It is important to note, however, that only 50 percent of the actual cost of the meal can be deducted (assuming that you keep all of your receipts).

With respect to entertainment deductions, you should be aware that you are only allowed to deduct 50 percent of these expenses as well. There are also a number of restrictions to claiming business entertainment deductions; still, it is possible to make the deduction, so long as you are discussing business with the person being entertained either during, just before or right after the event occurs.

Save For Your Retirement

Contributing to your retirement future can both lower your tax bill now and help you build tax-deferred investment income for the future. This includes making contributions to a simple IRA, a SEP-IRA and/or a solo 401(k). The IRS changes contribution maximums on a yearly basis; however, by way of an example, the contribution limit for a solo 401(k) increased to $53,000 for 2015.

At East Coast Tax Consulting Group, LLC, we are prepared to help self-employed individuals navigate the often complex world of tax deductions and benefits. Contact our office today to schedule a consultation to discuss your specific situation.

Contact Us 

You deserve the best in IRS tax representation, tax preparation, and tax planning services. At East Coast Tax Consulting Group, you’ll work with a licensed CPA who will handle your case from beginning to end. We invite you to contact our team to schedule a free, confidential consultation.

[gravityforms id="5" title="false" description="false" ajax="true" tabindex="199"]
<script type="text/javascript">var gform;gform||(document.addEventListener("gform_main_scripts_loaded",function(){gform.scriptsLoaded=!0}),window.addEventListener("DOMContentLoaded",function(){gform.domLoaded=!0}),gform={domLoaded:!1,scriptsLoaded:!1,initializeOnLoaded:function(o){gform.domLoaded&&gform.scriptsLoaded?o():!gform.domLoaded&&gform.scriptsLoaded?window.addEventListener("DOMContentLoaded",o):document.addEventListener("gform_main_scripts_loaded",o)},hooks:{action:{},filter:{}},addAction:function(o,n,r,t){gform.addHook("action",o,n,r,t)},addFilter:function(o,n,r,t){gform.addHook("filter",o,n,r,t)},doAction:function(o){gform.doHook("action",o,arguments)},applyFilters:function(o){return gform.doHook("filter",o,arguments)},removeAction:function(o,n){gform.removeHook("action",o,n)},removeFilter:function(o,n,r){gform.removeHook("filter",o,n,r)},addHook:function(o,n,r,t,i){null==gform.hooks[o][n]&&(gform.hooks[o][n]=[]);var e=gform.hooks[o][n];null==i&&(i=n+"_"+e.length),gform.hooks[o][n].push({tag:i,callable:r,priority:t=null==t?10:t})},doHook:function(n,o,r){var t;if(r=Array.prototype.slice.call(r,1),null!=gform.hooks[n][o]&&((o=gform.hooks[n][o]).sort(function(o,n){return o.priority-n.priority}),o.forEach(function(o){"function"!=typeof(t=o.callable)&&(t=window[t]),"action"==n?t.apply(null,r):r[0]=t.apply(null,r)})),"filter"==n)return r[0]},removeHook:function(o,n,t,i){var r;null!=gform.hooks[o][n]&&(r=(r=gform.hooks[o][n]).filter(function(o,n,r){return!!(null!=i&&i!=o.tag||null!=t&&t!=o.priority)}),gform.hooks[o][n]=r)}});</script> <div class='gf_browser_unknown gform_wrapper gform_wrapper_original_id_5 gravity-theme whitepaper-cta-popup_wrapper' id='gform_wrapper_1750851389' ><div id='gf_1750851389' class='gform_anchor' tabindex='-1'></div><form method='post' enctype='multipart/form-data' target='gform_ajax_frame_1750851389' id='gform_1750851389' class='whitepaper-cta-popup' action='/look-tax-benefits-deductions-available-self-employed-individuals/#gf_1750851389' novalidate> <div class='gform_body gform-body'><div id='gform_fields_1750851389' class='gform_fields top_label form_sublabel_below description_below'><div id="field_5_2" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_2"><label class='gfield_label' for='input_1750851389_2' >First Name<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_text'><input name='input_2' id='input_1750851389_2' type='text' value='' class='large' tabindex='199' placeholder='First Name' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_3" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_3"><label class='gfield_label' for='input_1750851389_3' >Last Name<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_text'><input name='input_3' id='input_1750851389_3' type='text' value='' class='large' tabindex='200' placeholder='Last Name' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_1" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_1"><label class='gfield_label' for='input_1750851389_1' >Email Address<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_email'> <input name='input_1' id='input_1750851389_1' type='email' value='' class='large' tabindex='201' placeholder='Email Address' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_4" class="gfield gform_validation_container field_sublabel_below field_description_below gfield_visibility_visible" data-js-reload="field_5_4"><label class='gfield_label' for='input_1750851389_4' >Email</label><div class='ginput_container'><input name='input_4' id='input_1750851389_4' type='text' value='' autocomplete='new-password'/></div><div class='gfield_description' id='gfield_description_5_4'>This field is for validation purposes and should be left unchanged.</div></div></div></div> <div class='gform_footer top_label'> <button type='submit' onclick='if(window["gf_submitting_1750851389"]){return false;} if( !jQuery("#gform_1750851389")[0].checkValidity || jQuery("#gform_1750851389")[0].checkValidity()){window["gf_submitting_1750851389"]=true;} ' onkeypress='if( event.keyCode == 13 ){ if(window["gf_submitting_1750851389"]){return false;} if( !jQuery("#gform_1750851389")[0].checkValidity || jQuery("#gform_1750851389")[0].checkValidity()){window["gf_submitting_1750851389"]=true;} jQuery("#gform_1750851389").trigger("submit",[true]); }' id='gform_submit_button_1750851389' class='gform_button button om-trigger-conversion'>Submit</button> <input type='hidden' name='gform_ajax' value='form_id=5&amp;title=&amp;description=&amp;tabindex=199' /> <input type='hidden' class='gform_hidden' name='is_submit_5' value='1' /> <input type='hidden' class='gform_hidden' name='gform_submit' value='5' /> <input type='hidden' class='gform_hidden' name='gform_unique_id' value='' /> <input type='hidden' class='gform_hidden' name='state_5' value='WyJbXSIsIjE3OGJjZmUyNjg3ZTQyOGFjZTRkZjMzZjBiOTAzYTRlIl0=' /> <input type='hidden' class='gform_hidden' name='gform_target_page_number_5' id='gform_target_page_number_5' value='0' /> <input type='hidden' class='gform_hidden' name='gform_source_page_number_5' id='gform_source_page_number_5' value='1' /> <input type='hidden' name='gform_random_id' value='1750851389' /><input type='hidden' name='gform_field_values' value='' /> </div> </form> </div> <iframe style='display:none;width:0px;height:0px;' src='about:blank' name='gform_ajax_frame_1750851389' id='gform_ajax_frame_1750851389' title='This iframe contains the logic required to handle Ajax powered Gravity Forms.'></iframe> <script type="text/javascript"> gform.initializeOnLoaded( function() {gformInitSpinner( 1750851389, 'https://www.eastcoasttaxconsulting.com/wp-content/plugins/gravityforms/images/spinner.svg' );jQuery('#gform_ajax_frame_1750851389').on('load',function(){var contents = jQuery(this).contents().find('*').html();var is_postback = contents.indexOf('GF_AJAX_POSTBACK') >= 0;if(!is_postback){return;}var form_content = jQuery(this).contents().find('#gform_wrapper_1750851389');var is_confirmation = jQuery(this).contents().find('#gform_confirmation_wrapper_1750851389').length > 0;var is_redirect = contents.indexOf('gformRedirect(){') >= 0;var is_form = form_content.length > 0 && ! is_redirect && ! is_confirmation;var mt = parseInt(jQuery('html').css('margin-top'), 10) + parseInt(jQuery('body').css('margin-top'), 10) + 100;if(is_form){jQuery('#gform_wrapper_1750851389').html(form_content.html());if(form_content.hasClass('gform_validation_error')){jQuery('#gform_wrapper_1750851389').addClass('gform_validation_error');} else {jQuery('#gform_wrapper_1750851389').removeClass('gform_validation_error');}setTimeout( function() { /* delay the scroll by 50 milliseconds to fix a bug in chrome */ jQuery(document).scrollTop(jQuery('#gform_wrapper_1750851389').offset().top - mt); }, 50 );if(window['gformInitDatepicker']) {gformInitDatepicker();}if(window['gformInitPriceFields']) {gformInitPriceFields();}var current_page = jQuery('#gform_source_page_number_5').val();gformInitSpinner( 1750851389, 'https://www.eastcoasttaxconsulting.com/wp-content/plugins/gravityforms/images/spinner.svg' );jQuery(document).trigger('gform_page_loaded', [1750851389, current_page]);window['gf_submitting_1750851389'] = false;}else if(!is_redirect){var confirmation_content = jQuery(this).contents().find('.GF_AJAX_POSTBACK').html();if(!confirmation_content){confirmation_content = contents;}setTimeout(function(){jQuery('#gform_wrapper_1750851389').replaceWith(confirmation_content);jQuery(document).scrollTop(jQuery('#gf_1750851389').offset().top - mt);jQuery(document).trigger('gform_confirmation_loaded', [1750851389]);window['gf_submitting_1750851389'] = false;wp.a11y.speak(jQuery('#gform_confirmation_message_1750851389').text());}, 50);}else{jQuery('#gform_1750851389').append(contents);if(window['gformRedirect']) {gformRedirect();}}jQuery(document).trigger('gform_post_render', [1750851389, current_page]);} );} ); </script>
[gravityforms id="5" title="false" description="false" ajax="true" tabindex="199"]
<div class='gf_browser_unknown gform_wrapper gform_wrapper_original_id_5 gravity-theme whitepaper-cta-popup_wrapper' id='gform_wrapper_339514421' ><div id='gf_339514421' class='gform_anchor' tabindex='-1'></div><form method='post' enctype='multipart/form-data' target='gform_ajax_frame_339514421' id='gform_339514421' class='whitepaper-cta-popup' action='/look-tax-benefits-deductions-available-self-employed-individuals/#gf_339514421' novalidate> <div class='gform_body gform-body'><div id='gform_fields_339514421' class='gform_fields top_label form_sublabel_below description_below'><div id="field_5_2" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_2"><label class='gfield_label' for='input_339514421_2' >First Name<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_text'><input name='input_2' id='input_339514421_2' type='text' value='' class='large' tabindex='199' placeholder='First Name' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_3" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_3"><label class='gfield_label' for='input_339514421_3' >Last Name<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_text'><input name='input_3' id='input_339514421_3' type='text' value='' class='large' tabindex='200' placeholder='Last Name' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_1" class="gfield gfield_contains_required field_sublabel_below field_description_below hidden_label gfield_visibility_visible" data-js-reload="field_5_1"><label class='gfield_label' for='input_339514421_1' >Email Address<span class="gfield_required"><span class="gfield_required gfield_required_asterisk">*</span></span></label><div class='ginput_container ginput_container_email'> <input name='input_1' id='input_339514421_1' type='email' value='' class='large' tabindex='201' placeholder='Email Address' aria-required="true" aria-invalid="false" /> </div></div><div id="field_5_4" class="gfield gform_validation_container field_sublabel_below field_description_below gfield_visibility_visible" data-js-reload="field_5_4"><label class='gfield_label' for='input_339514421_4' >Email</label><div class='ginput_container'><input name='input_4' id='input_339514421_4' type='text' value='' autocomplete='new-password'/></div><div class='gfield_description' id='gfield_description_5_4'>This field is for validation purposes and should be left unchanged.</div></div></div></div> <div class='gform_footer top_label'> <button type='submit' onclick='if(window["gf_submitting_339514421"]){return false;} if( !jQuery("#gform_339514421")[0].checkValidity || jQuery("#gform_339514421")[0].checkValidity()){window["gf_submitting_339514421"]=true;} ' onkeypress='if( event.keyCode == 13 ){ if(window["gf_submitting_339514421"]){return false;} if( !jQuery("#gform_339514421")[0].checkValidity || jQuery("#gform_339514421")[0].checkValidity()){window["gf_submitting_339514421"]=true;} jQuery("#gform_339514421").trigger("submit",[true]); }' id='gform_submit_button_339514421' class='gform_button button om-trigger-conversion'>Submit</button> <input type='hidden' name='gform_ajax' value='form_id=5&amp;title=&amp;description=&amp;tabindex=199' /> <input type='hidden' class='gform_hidden' name='is_submit_5' value='1' /> <input type='hidden' class='gform_hidden' name='gform_submit' value='5' /> <input type='hidden' class='gform_hidden' name='gform_unique_id' value='' /> <input type='hidden' class='gform_hidden' name='state_5' value='WyJbXSIsIjE3OGJjZmUyNjg3ZTQyOGFjZTRkZjMzZjBiOTAzYTRlIl0=' /> <input type='hidden' class='gform_hidden' name='gform_target_page_number_5' id='gform_target_page_number_5' value='0' /> <input type='hidden' class='gform_hidden' name='gform_source_page_number_5' id='gform_source_page_number_5' value='1' /> <input type='hidden' name='gform_random_id' value='339514421' /><input type='hidden' name='gform_field_values' value='' /> </div> </form> </div> <iframe style='display:none;width:0px;height:0px;' src='about:blank' name='gform_ajax_frame_339514421' id='gform_ajax_frame_339514421' title='This iframe contains the logic required to handle Ajax powered Gravity Forms.'></iframe> <script type="text/javascript"> gform.initializeOnLoaded( function() {gformInitSpinner( 339514421, 'https://www.eastcoasttaxconsulting.com/wp-content/plugins/gravityforms/images/spinner.svg' );jQuery('#gform_ajax_frame_339514421').on('load',function(){var contents = jQuery(this).contents().find('*').html();var is_postback = contents.indexOf('GF_AJAX_POSTBACK') >= 0;if(!is_postback){return;}var form_content = jQuery(this).contents().find('#gform_wrapper_339514421');var is_confirmation = jQuery(this).contents().find('#gform_confirmation_wrapper_339514421').length > 0;var is_redirect = contents.indexOf('gformRedirect(){') >= 0;var is_form = form_content.length > 0 && ! is_redirect && ! is_confirmation;var mt = parseInt(jQuery('html').css('margin-top'), 10) + parseInt(jQuery('body').css('margin-top'), 10) + 100;if(is_form){jQuery('#gform_wrapper_339514421').html(form_content.html());if(form_content.hasClass('gform_validation_error')){jQuery('#gform_wrapper_339514421').addClass('gform_validation_error');} else {jQuery('#gform_wrapper_339514421').removeClass('gform_validation_error');}setTimeout( function() { /* delay the scroll by 50 milliseconds to fix a bug in chrome */ jQuery(document).scrollTop(jQuery('#gform_wrapper_339514421').offset().top - mt); }, 50 );if(window['gformInitDatepicker']) {gformInitDatepicker();}if(window['gformInitPriceFields']) {gformInitPriceFields();}var current_page = jQuery('#gform_source_page_number_5').val();gformInitSpinner( 339514421, 'https://www.eastcoasttaxconsulting.com/wp-content/plugins/gravityforms/images/spinner.svg' );jQuery(document).trigger('gform_page_loaded', [339514421, current_page]);window['gf_submitting_339514421'] = false;}else if(!is_redirect){var confirmation_content = jQuery(this).contents().find('.GF_AJAX_POSTBACK').html();if(!confirmation_content){confirmation_content = contents;}setTimeout(function(){jQuery('#gform_wrapper_339514421').replaceWith(confirmation_content);jQuery(document).scrollTop(jQuery('#gf_339514421').offset().top - mt);jQuery(document).trigger('gform_confirmation_loaded', [339514421]);window['gf_submitting_339514421'] = false;wp.a11y.speak(jQuery('#gform_confirmation_message_339514421').text());}, 50);}else{jQuery('#gform_339514421').append(contents);if(window['gformRedirect']) {gformRedirect();}}jQuery(document).trigger('gform_post_render', [339514421, current_page]);} );} ); </script>