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Accounting and Tax Tips Blog

Cleaning Fees:

Cleaning, both supplies and paying for a professional services is an absolute necessity to run a organized and professional Etsy business.  The amount that you can deduct is equal to the amount spent taking care of the area where you perform your Etsy business or the fees incurred to a professional cleaning company to clean your home – those expenses can be deducted as well.

Charitable Contribution: 
Contributing to a qualified charity is a great way to get a deduction where you can control the timing and amount. You can do this by donating stock or property (e.g. furniture, clothing) rather than cash. You can deduct the property’s fair market value on the date of the gift which allows you to avoid paying capital gains tax on the built-up appreciation (with specific regards to donating stock).

Retirement contributions:

 As a 1099 Etsy seller, you can take advantage of the generous funding rules (or simply put, how much you can contribute) for self-employed IRAs.  The amount that you fund into your SEP-IRA is shown as a direct adjustment on page 1 of your tax return, lowering your taxable income.  To be eligible, you must be self-employed.  The accounts are easy to setup and maintain with no annual maintenance fees.  You are given until April 15 of the following year to fund your account, even if you have already filed your tax return.  You can fund up to 25% of your self-employed compensation, to a maximum of $53,000 for 2015.  Contributing to your retirement is an excellent way to save for your later years while reducing what you pay to the IRS right now.