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February 06: SELF STORAGE UNITS ARE THE BEST FOR SMALL BUSINESS OWNERS, AREN’T THEY?
- 02/06/2019 at 8:30 am
- 12/31/2019 at 5:30 pm
- SELF STORAGE UNITS ARE
THE BEST FOR SMALL BUSINESS OWNERS,
But when you use a self-storage area for your business, it seems like it’s something you should be able to write off on your business taxes. And the good news is that you can.
They come in handy to hold a wide variety of necessities, such as extra inventory, materials used to create your product, excess office supplies, parts and equipment that aren’t immediately needed in your repair shop, and old records and files that you’d prefer not to have cluttering up your work space, yet you know you should keep on hand for future reference.
HOW CAN I DEDUCT SELF STORAGE EXPENSES?
While you might initially consider the storage space your “home office,” especially if you visit there a lot for your business, you don’t want to classify the business deduction the same way you would your den or other dedicated work space, says Gary Blumenthal, CPA and vice president of Betro and Company in Foxboro, MA. Instead the storage space actually should be classified as “rent.”
That means the rental charge would be added to any other rental charges you might incur for leased space, such as for an office or factory, and deducted as a business expense as part of the rental category, says Mark H. Misselbeck, C.P.A., M.S.T. with Katz, Nannis + Solomon, P.C, in Waltham, MA.
Here’s exactly where you would include it on your taxes, according to Blumenthal:
· For sole proprietors and single-member LLCs: Include it on Schedule C—Line 20B
· For partnerships and multiple member LLCs: Add it to Form 1065—Line 13
· For C-Corporations: Include it on Form 1120—Line 16
· For S-Corporations: Include on Form 1120S—Line 11
WHAT IF THE SELF STORAGE IS “MIXED USE?
Got a few personal items included in there; say some out-of-season camping equipment on shelves off to the side from your main inventory area? It’s common for the entire unit not to be used solely for business purposes but doesn’t mean that you can’t take the deduction you’re owed, Blumenthal says.
“If you also use the units to store personal items, the cost of renting the space must be allocated between the business use and the personal use,” Misselbeck says. But to make sure you’re legally deducting what you should, you’ll want to figure out what percentage of the square footage is occupied by the business items compared to your personal property.
Blumenthal suggests that the easiest way to figure the business portion is by taking the percentage of square feet taken up by your business needs over the total square footage of the unit and multiply that by the total rental charge.
So let’s say your 10 x 10 storage unit runs $100 a month. You use 60 percent of it to store furniture that you have salvaged and intend to refinish and sell. The other 40 percent, well, it’s none of anyone’s dang business that you are holding on to Beanie Babies and a few other collectibles hoping for a resurgence, now, is it?
You’d take that $100 and allocate $60 of it for the tax deduction and $40 for the “other uses” that can’t be written off. If you have any questions about how to determine the appropriate ratio for tax purposes, be sure to consult with a trusted tax advisor.
But, if the greater part of the entire volume of space is devoted to one or the other use, Misselbeck suggests modifying the equation. “An allocation using cubic feet might be more appropriate to measure the allocation of the cost of renting the space and how much can be deducted,” he says.
Estimate to the best of your ability, but it can’t hurt to take photos for each tax year, says Blumenthal, in case you need to prove it in the event of an IRS or state tax audit.
Bottom line? Self-storage units can play an important role in keeping your business running smoothly, and you should make sure you enjoy the full tax deduction you legally deserve.
Article by: Cathie Ericson on June 15, 2018
March 04: Keeping Your Self-Storage Unit Organized Easily
- 03/04/2019 at 6:00 am
- 12/31/2019 at 5:30 pm
- Keeping Your Self-Storage Unit Organized EasilyIt is all too easy for a self-storage unit to end up looking like that closet you are afraid to open, or that corner of the garage you’ll tidy up some day. Protect your valuables and save yourself some stress by following just a few easy steps listed below for an organized self-storage unit.
? Make a List
Start out with a list of every item you are storing. This is helpful to do before you start filling your unit. Having it all laid out in front of you will help you plan where to place each item to maximize the amount of available space. The list can later hang inside the unit to remind you of which items you stored.
? Make a Map
Make a simple map of your storage unit as you pack it up. Three months from now when you are searching for your summer clothing or those tax papers from three years ago that map will save you the stress of having to tear apart the entire unit.
? Pack Properly
Plan ahead when you’re packing. You can save space by placing boxes on bookshelves or small items inside a washing machine or dryer. Organized just right, you’ll be amazed at how much you can fit inside your storage unit.
? Label Everything
While this step may seem obvious, it is often overlooked, especially if you are packing in a hurry. Even if you only have a few items to store now, it is still important to label each box accurately. You may add to your stored items later and those boxes could be easily mislaid if they aren’t labeled clearly.
? Protect Your Valuables
There are several ways to protect valuable items, including important papers, in your self-storage unit. The most important step is careful packing. Make sure you provide ample padding to breakable items and label delicate boxes.
If you are storing clothing, furniture, instruments, important documents, artwork or electronics you should consider renting a temperature-controlled storage unit to prevent damage from extreme temperatures or humidity.
? Use a Storage App
It seems there is an app for just about everything these days, and self-storage is no exception. There are a variety of apps that can help you stay organized. One example is called Moving Day. As you pack and load up each item you can easily categorize it with the app. Moving Day even lets you assign values to each item in case you have to make an insurance claim one day.
Check out this link for some others to choose from:
A quality self storage facility will have educated staff members available to assist you in choosing the best space for your needs and utilizing all the tips suggested here.
Call the experts at Overton Road Self Storage to learn more, 205-956-5522.
March 06: Spring Forward: 8 Smart Tasks To Do Every Daylight Savings Day
- 03/06/2019 at 6:00 am
- 12/31/2019 at 5:30 pm
Daylight savings time rolls around twice a year for most of the country, and while it may moderately disrupt your sleep schedule for a few days, the event is an excellent reminder to tackle those infrequent chores. The days are slowly getting longer from now until the summer solstice, leaving you plenty of time to check off a few extra tasks. Add add these eight tasks to your daylight savings time change to-do list.
- Wash your windows. It’s an arduous chore that, thankfully, needs to be done only periodically. “Unless you have pets or small children who leave smudges, you may not need to clean the inside of the window,” says , a certified housecleaning technician and small-space expert. (Pro tip: You can hire someone to do this for you for around $100.)
- Clean under rugs and appliances. Roll up your and vacuum underneath them. Pull out your stove and refrigerator and do the same. It’s also a good idea to gently vacuum your refrigerator coils, which will keep the fridge running properly. Be sure to unplug the fridge before doing this, and consult your user manual to find the location of the coils.
- Clean for safety. The daylight savings time change is a good reminder to change the batteries in smoke and carbon monoxide detectors. But while you’re at it, remove and wipe the detector cover with a damp cloth, then vacuum the interior to remove any dust particles, says Smallin Kuper. Check your dryer vents too, to make sure they are lint-free.
- Swap out your winter bedding. Remove your winter quilts and sheets and replace them . “Always launder these items before storing,” advises Smallin Kuper, adding that it helps keep moths at bay.
- Clean those hard-to-reach places. Working from high to low, start by wiping down ceiling fans and the tops of bookcases and other furniture with a duster that has an extending pole. Gently clean the inside of light fixtures and wipe down (cool) light bulbs to remove grime. Finally, dust baseboards and windowsills with a slightly damp microfiber cloth.
- Deep-clean carpets and rugs. If you haven’t done this before, it’s a sound idea to start now. “Many carpet manufacturers will void the warranty on carpets if they’re not professionally cleaned at least once every 12 to 18 months,” says Smallin Kuper.
- Declutter. Start with the obvious places, like your closet or junk drawer, but don’t skip the often-forgotten ones, like your bathroom and pantry. Go through your medicine cabinet and toss expired medications. Open up your cosmetic bag (or drawer) and throw out anything that looks a little grungy, and if you haven’t changed your toothbrush in a few months, swap it out for a new one. Toss anything in your pantry that’s expired and give your utensil drawer a once-over — are the knives too worn or in need of a little sharpening? Is there anything there that should be tossed?
- Clean your appliances. Wipe down the door of your stove, dishwasher, and fridge with warm, soapy water. Turn on the self-clean cycle in your oven and then tackle the inside of your dishwasher with a toothbrush and hot, soapy water, making sure to clean the rubber seal inside the door. Wipe away any debris with a leftover sponge, put a cup full of white vinegar on the top rack, and run a full cycle. When the cycle is done, wipe the inside of the dishwasher with a soft cloth.