business deduction

Thân thiện

A business owner records a business deduction in their accounting software.

Definition

1. Noun:
   • A tax write-off for expenses of doing business: A "business deduction" is an expense that can be subtracted from a company's or individual's gross income when calculating taxable income, because the expense was necessary and ordinary for conducting business operations.

Usage Examples

• Noun:
  • The cost of a new computer for his home office was a valid business deduction.
  • Consulting a tax professional can help you identify all eligible business deductions.
  • Travel expenses for client meetings are a common type of business deduction.

Advanced Usage

• "To claim a business deduction": To formally declare an expense as a deduction on a tax return.
  • Make sure you keep all receipts if you plan to claim a business deduction for those meals.
• "Allowable business deduction": A deduction that is permitted under the tax code.
  • Office supplies are typically an allowable business deduction.

Variants and Related Words

• Deduction (n): The general act of subtracting an amount or an item that is subtracted.
  • She itemized her deductions on her tax form.
• Tax deduction (n): A broader term for any deduction that reduces taxable income, not exclusively for business.
  • Charitable contributions are a popular tax deduction.

Synonyms

• Business expense write-off
• Trade expense deduction

Related Phrases

• Above-the-line deduction: A deduction subtracted from gross income to calculate adjusted gross income (AGI), which can include certain business expenses for self-employed individuals.
  • For freelancers, health insurance premiums can be an above-the-line deduction.
• Below-the-line deduction: Deductions (itemized or standard) subtracted from AGI to calculate taxable income.

Notes

• The term "business deduction" is a specific compound noun. Its meaning is directly tied to tax law and accounting practices. It is crucial to maintain accurate records to substantiate any claimed business deduction in case of an audit. Rules governing what qualifies can vary by jurisdiction.

Học thuật

Noun

1. tax write-off for expenses of doing business