general and administrative expenses meaning

General and administrative expenses meaning plus#
General and administrative expenses meaning professional#

Just make sure to keep a log of your business-related travel for tax purposes at the end of each day enter the miles you drove on your appointment calendar. Meeting with a prospective client or doing something to promote your business is considered business mileage. What constitutes a business mile? The distance you drive from your home to your place of business is not deductible, but mileage you drive from your place of business to any other location for business purposes is. Your deduction would be 44.5 cents x 12,000 miles, or $5,340. Of those, 12,000 were for business purposes.

Suppose you drive a car 20,000 miles a year. To calculate the deductions you could make based on straight mileage is very simple. If they're greater, you can carry them over to the following year.Īs of January 1, 2006, business-related automobile mileage is deductible at the rate of 44.5 cents a mile. All your home-office expenses are deductible if they are less than your gross income from the business use of your home. However, there is a limit to what you may deduct. If the business didn't make enough money to absorb the home-office deduction, you can deduct the excess from income earned on a 9-to-5 job, if you still have one, or from your spouse's income, if you file a joint return. Allocation of home-office expenses is generally made on the basis of the ratio of square footage used exclusively for business to total square footage of the residence.

General and administrative expenses meaning plus#

Home-office expenses that are eligible for deduction include all normal office expenses plus interest, taxes, insurance, and depreciation on the portion of your home used exclusively for business. You can deduct business-related telephone charges made from your home number, as well as business equipment and supplies, but you will not be able to deduct any part of your rent or depreciate any part of the property as a business expense. If you have another office somewhere else, you may not be able to deduct the cost of a home office as well.

Remember that you can only claim this deduction if your home office is your principal place of business and that office is used for no other purposes other than your business. If you work out of your home, investigate whether a home-office deduction makes sense for you.

General and administrative expenses meaning professional#

Your CPA can help you figure out exactly which costs fall into this category, but here a few general guidelines:ĭeductible general and administrative (G&A) expenses include telephone, utilities, office rent, salaries, legal and accounting expenses, professional services, dues, and subscriptions to business publications. One of the big advantages of owning a business is that many of the costs of doing business are tax deductible.