Any expense that is directly related to producing the income of your small business is deductible. As you noted there is a line between personal use and business use of some types of expenses such as auto mileage, cell phones, etc.
It's important to track the time of business use versus the time of personal use for any property that is easily convertible between the two. Time is the IRS measurement for most of these items. For automobiles it's the mileage documented with business purpose, location and date as well as the mileage for each purpose/function. You should jot down your odometer reading right now and then back track it as close as possible to January 1, for 2017. Then write it down on December 31st. Set a reminder for yourself.
I've included screen images of the business expense categories.
Equipment should always be recorded in a class of it's own. Any purchase of equipment that has more than a one year estimated life would be classified as a depreciable asset for your business.
Keep great records, they are your best friend at tax time. Check out Intuit quickbooks by using this link for more information. This will help you track your income, your expenses and allow you to invoice your customers.
Still have questions?Make a post