Nothing gets us all in the giving mood like the holiday season. After a long year, you’re looking to spread a little extra cheer and goodwill to your employees, clients, and associates in the form of some thoughtful gifts.
But you find yourself wondering: is that box of chocolates or basket of assorted cheeses considered a tax deductible business expense?
At Revel, we love gift-giving as much as everyone else, and we also know how to do it in a business-savvy way. While business gifts are only tax deductible up to a certain amount, here are some money-saving strategies you can put in place this holiday season!
Business gifts are tax deductible by up to $25 per person
Gifts given to employees, clients, or other business connections are tax deductible only up to $25 per person, per tax year. As the IRS explains, incidental costs like engraving, packing, or shipping aren’t included in this $25 limit.
You should also be sure to keep good records that track the value and purpose of these gifts for future tax returns. You’ll want to keep those handy when tax season rolls around!
It’s 100% possible to get some great gifts for $25 or less, but what if you were hoping to be a bit more giving this holiday season? Do you have to write all your expensive gifts off as a non-deductible expense?
Not necessarily.
Here are two money-saving ways you can give this holiday season
Donations
Instead of another juicer or cocktail set this holiday season, you could instead give a charitable donation in someone else’s name. This is not just a great way to spread good in the world and connect with people on the issues that matter to them most, but it can also save you money.
Charitable donations, even when given on someone else’s behalf, retain their character as a donation. As long as you itemize your deductions and are giving to a qualified organization, you can deduct the full amount of your gift donation.
Marketing
Want to spread goodwill and your company name at the same time? Consider combining your gift-giving with your marketing strategy!
Everything from the packaging you send your gift in to the gift itself can be branded with your logo and company colors. Get creative with it! Because it’s considered part of marketing and advertising to send something with a company logo to your clients, these expenses are completely deductible!
However you choose to give this holiday season, helping you save money is our gift to you. For more tips, tricks, and tools to start and scale your creative business, check out our 6-part creative business bootcamp, Minding Your Business.
Gain the confidence you need to kick your journey into high gear!
