Halloween is over and although Thanksgiving is our next official holiday, I am seeing Christmas and Hanukah decorations everywhere! I like to enjoy each holiday as it comes, but if you’re starting to put together your holiday gift list, there are some things you can do to save money and stay out of the holiday red.
Here are some of my favorite holiday budgeting tips:
GIVE A GIFT, IT’S TAX DEDUCTIBLE
If you’re a small or medium sized business owner, giving a gift to a customer during
the holidays is not only a nice gesture and a good marketing technique, but it can
also be deducted from your taxes. Keep in mind though, that no matter how much the
gift costs, only $25 is tax deductible per recipient every year. However, if you
ship the gift or personalize it, you can deduct that cost as well. Make sure to
keep your receipts. Finally, tax deductible gifts can only be given to a legitimate
work associate such as clients, customers, co-workers and employees.
GIFT OR ENTERTAINMENT
Business owners often give clients or customers tickets to a sporting event or show.
If you go with your client to the event, the IRS considers this an entertainment
expense and is 50% tax deductible. If you don’t attend the event, you can either
claim the $25 gift deductible or write it off as an entertainment expense. Figure
out which one benefits you based on the cost of the tickets.
MAKE A LIST
Santa shouldn’t be the only one to make a list and check it twice. Make sure you
go to the store with a list of people you want to buy for and how much you want
to spend. Whatever you do, don’t go over budget.
GO GREEN
Going green is great for the environment, but it can also save you money. If you
are buying new holiday lights, purchase the strings with LED bulbs. LED bulbs cost
less to operate compared to the old, incandescent kind. You should see the savings
in your utility bill next month.
KEEP GOOD RECORDS
Make sure you keep all of your receipts. At DM Accounting, we keep track of all
of our client’s purchases and make sure they take advantage of every IRS deduction
available, but we can’t do it without the right documents. When you make a holiday
purchase, write down the name of the business associate, the date you made the purchase
and the cost of the gift.
As you get ready to hit the stores, make sure you keep these tips in mind. The only
way we want to see you in the red is in your best holiday attire.
Here’s to the start of a wonderful holiday season!
