What Are Some Tax Credits for Small Businesses?


Quick Answer

As of 2015, tax credits for small business owners include using a car for business, the expenses involved with operating a business, fees, business entertainment and bad debts, according to Nolo. Small business owners can also deduct the cost of traveling for business.

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What Are Some Tax Credits for Small Businesses?
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Full Answer

For using a vehicle for business to count as a tax credit, the business owner can either keep up with the number of miles driven in a single tax year or keep track of the expenses involved with maintaining and using the vehicle, notes Nolo. If the taxpayer uses the vehicle for both business and personal use, only the time and expenses for business purposes can apply to the tax credit. Business owners can also receive a larger tax credit by using a newer vehicle model for business purposes.

Business expenses that count as a tax credit include utilities, marketing, business-related repairs and office supplies, according to Nolo. However, any expenses incurred before officially opening a business don't count toward the credit, and small business owners are only permitted to deduct as much as $5,000 for the initial business year. Anything higher has to be divided over the following 15 years.

Fees that qualify for a tax credit for small business owners include those from lawyers, business consultants and tax professionals, as Nolo explains. Any fees related to the business' future years have to be spread out over the duration of the received business benefit.

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