Whether you own a funeral home or another death care industry business, there are many expenses you encounter over the course of a month to keep your business going. One of the considerations that you might make during the purchasing process is whether or not items are tax deductible. Because the tax code is complex, you should familiarize yourself with the regulations surrounding what is tax deductible and what is not. What are some of the things that your death care industry business can write off come tax time?
This term is used to refer to things that you sell to families, so it would include vaults, monuments, caskets, urns and more. Tracking the quantity and cost of the inventory is critical to ensure you are writing off the correct amount. Inventory can be expensed when it is sold, so if you spend $10,000 on caskets and they are in your inventory on the final day of the tax year, you can write off that $10,000 on your taxes.
Materials and Supplies
These tax deductible items are the things that you need to purchase to operate your business and provide services. On the administrative end, this might include things like office supplies and cleaning supplies. On the business end, this could include the broad range of consumable items you use, including cards, gloves, gels, sprays, cosmetics, fluids and more. These items can be expensed once they are consumed, but your tax professional at MKS&H can ensure you do things right.
Furniture, Fixtures and Equipment
Beyond the things that you purchase just to use once, there are things that you will need to purchase once and reuse. These items can be tax deductible or not depending on what they are and how you use them. For example, the de minimis rule allows you to expense individual items that cost less than $2,500. If you purchase 200 new chairs for your funeral home or business and they each cost $200, you would be able to expense the entire purchase and not just 2,500.
Financial Planning for Every Death Care Services Industry Business from MKS&H
MKS&H provides tax and accounting services to businesses of every size and in every industry, including the death care industry. Our team can help your business gain confidence in your important accounting reports and make better, more educated financial decisions. Contact us today for a consultation.