Each year as tax season approaches, people find ways to save money and avoid overpaying on their taxes. One way to do this is to track tax deductions and write-offs. This is especially important for those who are independent contractors or who own a business.
In this case, we’ll be discussing those who work in road construction. Whether you are an independent contractor with a 1099 or own a construction company, you definitely do not want to miss out on these commonly ignored tax deductions when April 15th rolls around.
Uniform and Safety Equipment
If you had to pay for the uniforms you wear on the job site or any branded clothing from the company, then you can write off this expense on your taxes. This also includes any safety equipment such as helmets, safety vests, steel-toed boots, goggles, and more.
Plus, if you have your uniform dry cleaned or need it repaired in any way, you can write off the cost of this service from your annual taxes.
Tools and Equipment
Any tools or equipment you use to get the job done, including k-rails, jackhammers, bulldozers, and everything in between, is all considered tax-deductible. These tools can become a major write-off on your overall taxes because they are absolutely necessary for conducting business.
When it comes to heavy machinery, you can deduct the depreciation of the equipment year after year. Plus, any repairs or maintenance you make to the equipment can be deducted when you keep the receipt and state the reason for the repair.
Training Classes and Certifications
In order to operate certain machinery or be on specific job sites, you must have the necessary certifications and training. Not every company will pay for you to attend these courses, so you’ll have to put the money for it down yourself.
If this is the case, then you can write off the expense of the course. You can also deduct the transportation you took to get to the class, but we’ll discuss more details about that next.
Remember, you can only write off this education if you are already working in the construction industry. If you are in the middle of switching industries and are attending courses to make the change, this is not tax deductible.
Transportation
Sometimes you may have to commute hours away to certain job sites. If you use your own vehicle to get there, then you can deduct the mileage. The IRS has a fixed amount for each mile you drive to get to and from your workplace when you’re an independent contractor or business owner. This fixed-rate covers what you pay for car insurance, gas, car maintenance, and the car itself.
Be sure to keep track of your mileage when you drive back and forth to job sites. This is one of the most common reasons people are audited, which can be strenuous and overwhelming if you aren’t organized.
