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As a business owner, you are likely aware that you need to keep note of every expense you make. These records will help you create a solid budget plan, prevent you from overspending and claim many potential tax deductions. However, there are certain costs that you might either overlook or fail to properly account, which can reduce profits in the long run. As you go through the finances, check for the following transactions.
Insurance Fees
Every business needs insurance for protection against several situations. There are some essential plans for any type of business you run.
- Property
- Professional liability
- Product liability
- Workers’ compensation
- Business interruption
Consider the services you provide, the tools or vehicles you use, the workforce at hand and other factors as you work with a provider to get the right plans. Do not overlook insurance, as it can cover you throughout unexpected scenarios that could otherwise devastate the business.
Utility Prices
No matter the size or purpose of the operation, you will need to take into account the utilities used on a monthly basis. From water to electric and gas, you need these basic services to function properly. Even if you do not underestimate these expenses and even find them difficult to meet, there are measures you can embrace to reduce them. For instance, you can use skylights to reduce the use of artificial lighting or install low-flow bathroom fixtures to decrease the water bill. Work with the companies to save on these costs.
Travel and Mileage Costs
One expense most people neglect is business-related travel. From driving to meet with customers to picking up required materials, these costs add up fast. However, you can record and deduct them as part of the job. The IRS website has helpful information on specific travel deductibles.
Miscellaneous Expenses
Even with these costs, there are still even smaller ones you might easily miss. These expenses are often ones you pay out of pocket, but then forget to reimburse. They can consist of purchasing additional small supplies like pens, paper or even locking caster wheels. If you have a meeting with a client or a partner, you may buy a meal or a snack for you both. No matter how small the purchase is, write it down if it involves business.
Running a business can create a plethora of unexpected costs. Keep your finances in a healthy shape by recording them, controlling the cash flow and accounting for deductions.