Are Bookkeeping Fees Tax Deductible?

As a business owner, expenses can add up. From ads to employee salaries and storefront improvements, companies are always in need of finding ways to save anywhere they can. On the surface, it might seem that an excellent way to save money would be to take on every task on your own. Contracting out services that your business needs costs money, and avoiding that cost seems like an obvious choice. But at the end of the day, bookkeeping services can help you save in the long run, and not only that, but the expenses can be tax-deductible. So, are bookkeeping fees tax deductible? Below are a few examples of Bookkeeping services that may qualify for tax credits.

Tax Preparation

Most businesses can write off fees they pay for tax preparation. These fees are seen as “ordinary and necessary” and can save you and your company a substantial amount of money. Hiring a professional to complete your business tax preparations is essential to your success. An expert can make sure you file every document correctly and don’t miss any deductibles. This knowledge could significantly reduce the amount of money you owe or substantially increase the refund owed to you. Additionally, professionals can make sure that you don’t make any errors when filing to avoid any issues with the IRS. If you are audited, your bookkeeper will be your representative and help you through the process.

Payroll Services 

Many professional expenses are deductible for businesses. Hiring someone to manage your payroll services will save you a headache. Knowing that your staff is getting their paychecks on time and for the correct amount each cycle will give everyone involved peace of mind. Getting a deduction for hiring bookkeepers to manage your payroll isn’t the only benefit of this arrangement. There are complicated payroll taxes that your business needs to pay. Your bookkeeper will make sure that the appropriate amount is withheld each pay cycle. This level of detail could save you from a costly mistake and help you plan your budget accordingly.

Bookkeeping

Like tax preparation and payroll services, bookkeeping can also be considered an “ordinary and necessary” service for your business and, therefore, eligible for a write-off. Bookkeeping is the backbone of any company that keeps the gears running smoothly. Hiring professionals is a great way to make sure that you are organized and efficient. Bookkeeping services include keeping track of your cash flow, managing invoices, and keeping track of accounts receivable. Services also include creating and managing Excel spreadsheets to track things like inventory and budgets.

All in all, the services provided by a place like PL Bookkeeping Plus can help your company reach the next level, take a tremendous amount of work off of your plate, and can save you money. Knowing that these services can be tax deductible can help give you the room in your budget to outsource these tasks. Consider booking an appointment to learn about ways in which we might be able to help you and your business by calling 410.764.3731, emailing us at info@plcfo.com, or filling out a form on our website.