Chickasha (405) 224-5404 | TEXT (405) 342-0003
Anadarko (405) 247-7323 | TEXT (405) 247-0243
Cement (405) 489-7158 | TEXT (405) 489-4989
☰ ˟



Locations Contact Us
 
Logo
Chickasha (405) 224-5404 | TEXT (405) 342-0003
Anadarko (405) 247-7323 | TEXT (405) 247-0243
Cement (405) 489-7158  | TEXT (405) 489-4989
  • Home
  • Get a Quote
  • Personal Insurance
    • Automobile
    • Bonds
    • Dental
    • Earthquake
    • Farm
    • Flood
    • Health
    • Homeowners
    • Life
    • Medicare
    • Motorcycle
    • Recreational Vehicle
    • Renters
    • Vision
    • Watercraft & Boat
  • Business Insurance
    • Business & Commercial
    • Commercial Auto
    • Commercial Bonds
    • Commercial Property
    • Construction
    • Cyber Liability
    • Employee Benefits
    • General Liability
    • Liquor Based Business
    • Workers Compensation
  • Resources
    • View Our Blog
    • Refer a Friend
    • Make a Payment
    • Policy Management Forms
    • File a Claim
    • Calculators
    • Important Company Links
    • Insurance Glossary
  • About Us
    • About Mollett Hunter Insurance
    • Our Locations
    • Testimonials
    • Privacy Policy
  • Contact
Home > Blog > Is Your Business Insurance Tax Deductible?
TUESDAY, SEPTEMBER 17, 2019

Is Your Business Insurance Tax Deductible?

Today’s business owners, start-up gurus and budding entrepreneurs love learning the ins and outs of business insurance. Between policy shopping tips, finding package policies and working on loss prevention, it seems there are a ton of money-savingimage of tax form approaches to policy planning.

So, what about taxes? If you’re running a for-profit business, you have a lot of expenses to write off. Can you deduct your business insurance costs?

Qualified Expenses: Ordinary and Necessary

Firstly, let’s dive into the qualities which determine whether your business insurance expenses fall into the deductible category. Usually, to deduct a business expense, it must be ordinary or necessary.

According to The Hartford, business expenses which are ordinary—or common and accepted in your industry—are valid deductions. Necessary expenses are expenses which are helpful, and appropriate, for your business’s operation. These expenses are deductible as well.

This means, as a business owner, that your business insurance policy is tax-deductible. Because most businesses require a business insurance policy due to industry regulations, state laws and contracts—adequate insurance is both ordinary and necessary.

Writing Off Your Business Insurance Premiums

You can deduct your policy’s premiums. This said, you may not be able to deduct an insurance package’s health insurance premiums if you’re a sole proprietor. It’s a good idea to work alongside a tax professional, as they understand the conditions required for deduction.

So, which premiums can you deduct? According to the IRS Business Expenses Guide, you can deduct premium expenses for the following types of business insurance:

  • General and Professional Liability Insurance
  • Commercial Property Insurance
  • Cyber Liability Insurance
  • Business Interruption Insurance
  • Workers’ Compensation Insurance
  • Commercial Auto Insurance

Non-deductible Expenses

There are a lot of business insurance expenses you can deduct. There are, however, several things you can’t deduct. For instance: You can’t deduct any payments into a self-insured reserve. Some big businesses utilize these reserves as a workers’ compensation alternative—which reduces their credibility as overall expense drivers.

You also can’t deduct disability policy premiums which cover any lost income. You also can’t deduct premiums made for a loan protection policy. This said, tax rules aren’t always absolute. Sometimes, it’s possible to find deductible items which may not seem deductible at first.

Double-check your business insurance policy’s boundaries with your tax adviser. In doing so, you’ll discover any expenses which might be deductible. Deducting your business insurance premiums is a great way to save money on annual taxes—and it’s something every business owner should do.

Also Read: Why It's Important to Purchase Business Insurance Tailored to Your Industry

Posted 5:19 PM

Tags: business insurance, tips
Share |


No Comments


Post a Comment
Required
Required (Not Displayed)
Required


All comments are moderated and stripped of HTML.

NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive
  • 2020
  • 2019
  • 2018
  • 2016

  • workers compensation(15)
  • case studies(13)
  • life insurance(6)
  • home insurance(6)
  • auto insurance(5)
  • business insurance(5)
  • tips(4)
  • summer(2)
  • fun(1)
  • master workcomp advisor(1)
  • movie(1)
  • new drivers(1)
  • high risk driver insurance(1)
  • safety(1)
  • business owners insurance(1)
  • covid-19(1)
  • movies(1)
  • the farmers alliance agent 2019(1)
  • small business(1)
  • fire extinguisher tips(1)
  • oklahoma(1)
  • sr22(1)
  • blog(1)
  • pet insurance(1)
  • mold damage(1)
  • workers comp(1)
  • fourth of july(1)
  • contractor insurance(1)
  • motorcycle(1)
  • employee benefits(1)
  • teen drivers(1)
  • family(1)
  • congratulations(1)
  • road rage(1)
  • claims(1)

View Mobile Version
Facebook
LinkedIn
Twitter
Instagram
Get Directions
Contact Us Today
Resources Payment Options
File a Claim
Refer A Friend
News
Contact us 501 S. 5th Street | Chickasha, OK 73018
Find the nearest location to you

 

religious fish symbol
© Copyright. All rights reserved. Powered by Insurance Website Builder.