There are so many reasons to invest in having a nice office. Most importantly, it creates a positive company culture and lets employees know what you’re all about. Your office layout impacts employee performance and can have a big impact on customer satisfaction. It can also affect your business’ profitability and overall success.
That being said, spending extra to make your office flexible and functional does involve one-time and ongoing costs. To make sure you’re getting the most out of your space, be sure to educate yourself on tax rules and how to write-off office expense deductions. Office expense deductions can be confusing. If you’re not sure where to begin, the following tips should get you started.
If you rent – or own – your office space, you can deduct your rent or mortgage interest costs. Does your business operate from home? If so, those costs are part of a home office deduction. Keep in mind, what you choose to write off will depend on whether you figure your home office deduction using actual costs or an IRS simplified method.
Office Furniture and Equipment
Tax law gives you a number of options for deducting your furniture and equipment costs. Section 179 first-year expensing, for example, is an overall dollar limit on the cost of property that allows you to expense the cost upfront ($1,020,000). Bonus depreciation, on the other hand, is 100% of your cost in the first year (for 2019). Just make sure you choose the right options for your business.
Your ability to deduct office supplies is premised on the notion that you will only buy what you think is necessary for the first year or so; these items are incidental materials and supplies (e.g. paper and pens, cleaning supplies, etc.) They are fully deductible when you purchase them.
Maintenance and Repairs
Thankfully, office maintenance and repairs are fully deductible. This includes the cost of ongoing maintenance, such as having a fish tank regularly serviced. Keep in mind, however, that if you make big, permanent improvements to your workspace, you may not be permitted to fully deduct those costs in the year they were paid for.
Spending money on your office space is worth it in the long run. Your workplace not only reveals a lot about your vision and culture, but it also inspires and motivates the employees that work there. If you need help planning your space, consider working with the team at Trader Boys. Find the best office furniture in Los Angeles, and secure the help you need for space planning.
Author Bio: Melissa Rayner is the 2nd generation owner of Trader Boys, where you will find quality office furniture in Los Angeles. She does her best writing at home in her sunny southern California garden.