5 Entrepreneur Expenses You Shouldn’t Overlook

You are a business owner who knows how much cash is in the bank and has all QuickBooks transactions reconciled. The importance of accounting is not lost on you, and you even got your tax documents early this year! While your experience has certainly helped your success, we want to help you become even more successful. You may understand the basics of an Income Statement, but we want you to have a deep understanding of what should and should not go on this important financial report. Specifically, your entrepreneur expenses.

It can be difficult for small business owners to keep their business and personal expenses separate. Why? Because oftentimes our business first started as a side gig or hobby. It can easily become our life and we may make purchases that feel like they don’t relate to our business – but they do!

Consider these 5 entrepreneur expenses.

1) Continuing Education

Invest in yourself! It is an important part of growing your business and making sure your skills are current with the trends. Don’t forget to count your continuing education as a business expense.

If you bought a magazine or book to learn how to create a new product or design, that purchase can be expensed. If you paid for an online seminar that showed you how to create your product with more sustainable resources, that can be expensed.

We often forget about these little expenses because we genuinely enjoy the work we do. However, if you are a business owner that makes money off this trade you love so dearly, you should be charging your continuing education expenses to your business.

2) Travel Expenses

At first, you may think, ‘I do charge my travel expenses,’ but there is a long list of expenses you likely forget throughout your business trip. For example:

• Highway tolls
• Parking fees
• Meals, drinks, and snacks
• Gas
• Taxi Fees

The important point to remember here is to be reasonable with your expenses. If you are eating at high-end restaurants every night and staying an added week after a conference, you will need to separate these in your financials for tax purposes.

3) Office Supplies

This can be an especially hard one to remember. Maybe you are putting together your weekly shopping list and remember you need pens, printer paper, an HMDI cable, or magnifying light. It is easy to quickly throw these items in your cart (think Amazon) and think nothing of it, but these are all items that support your business.

Your business should be covering these expenses and getting the tax benefits from you using them.

4) Cleaning Supplies

Like office supplies, these can easily be forgotten when going about our day. It can be even harder to remember if you work from home. If you are a creative person who does their best work in the garage, spare bedroom, or backyard, you likely have had a mess or two to clean up.

If you are home, it isn’t unreasonable to go into your cupboard and pull out some paper towels or rags, but these are now business expenses. Treat them as such!

5) Clothing

Many of us are doing work where our clothes get a bit worn out over time. For example, we have an apron or specific pants we wear when things get messy. Clothing that is specifically needed for this kind of work should be expensed. If the line between personal and business is a bit blurry, consider asking yourself these questions:

• Is this item required for the job?
• Will you be primarily wearing this item while you work?

If you answered yes to either of these, consider them entrepreneur expenses. Business owners are passionate people who love to bring a bit of joy and light into the world. We sometimes can get so involved in what we are producing, we may forget all that goes into making it possible. This is your gentle reminder to take inventory of everything you do for your business and make sure it is properly expensed.

If you’re still not sure, we suggest reaching out to discuss the nature of your business. This will help us make a personalized recommendation.