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US Taxes: Does Money Paid Toward Advertising Reduce Taxable Income 1:1?

Discussion in 'General Business' started by ScubaAddict, Mar 8, 2007.

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  1. #1
    As I sit here spending more and more on Adwords, I wonder...

    Using easy numbers, let's say my business made $100,000 last year. If I spent $10,000 on Advertising, is my taxable income now $90,000?
     
    ScubaAddict, Mar 8, 2007 IP
  2. mystickcal

    mystickcal Active Member

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    #2
    That is correct. You pay taxes on what your total is after all business expenses, you of course need to check with an accountant first to see what you can write off as a business expense.
     
    mystickcal, Mar 8, 2007 IP
  3. plumsauce

    plumsauce Peon

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    #3
    yes.

    and don't forget any interest or other fees on the card.
     
    plumsauce, Mar 8, 2007 IP
  4. tbarr60

    tbarr60 Notable Member

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    #4
    You are taxed on profit:

    Profit = Revenue - Cost

    Capture all costs and include that in your income from business calculation.
     
    tbarr60, Mar 8, 2007 IP
  5. drhfinegifts

    drhfinegifts Peon

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    #5
    Don't forget webhosting fees, domain name registration fees, etc. It is all deductible as long as it is a cost of running your business.
     
    drhfinegifts, Mar 9, 2007 IP