The Tax Cut and Jobs act really changed how deductions work. It's important to know how much those changes will affect you and your business. Here's another way taxes have changed recently:
Employee reimbursements, like commuting costs are gone
If you give your employees’ a reimbursement for their commute, this no longer is going to be able to be deducted at the end of the year. The same goes for entertainment expenses, so if you have a video game and ping pong room at your tech startup, you won’t be able to write that off either.
Even though you won’t get the write-off, most CPAs and accounting firms agree that it’s a bad idea to get rid of these policies. Anything you make up for in cost, you’ll lose in employee morale. Not worth it!
These are three big deductions going by the wayside in 2018 and beyond. Check in with your accounting firm to see what’s up with your taxes. That’s a discussion that needs to be ongoing throughout the year, so you’re not caught in March or April with a big unforeseen problem.
If you don't have an accounting firm, maybe it's time to think about hiring one. We would love to sit down and talk with you about your business.