Insurance Blog
Items filtered by date: April 2017
Sunday, 30 April 2017 23:41

Your Renters Insurance Checklist

What to Look for When You’re Shopping for Renters Insurance

move in boxes

If you rent a house or apartment, your landlord’s insurance will only cover the costs of repairing the building if there is a fire or other disaster. To financially protect yourself and your belongings you will need your own coverage, known as renters or tenants insurance.

Renters insurance includes three key types of financial protection: 

  • Coverage for Personal Possessions
  • Liability Protection
  • Additional Living Expenses 

The following checklist can help you choose the right coverage when you are shopping around for renters insurance or discussing your needs with an insurance professional.

A. Coverage for Personal Possessions

1. How much insurance should I buy?

Make sure you have enough insurance to replace all of your personal possessions in the event of a burglary, fire or other covered disaster. The easiest way to determine the value of all your personal possessions is to create a home inventory—a detailed list of all of your belongings along with their estimated value.

The Insurance Information Institute offers free Web-based home inventory software, available at www.knowyourstuff.org.

2. Should I choose replacement cost or actual cash value coverage?

Actual cash value policies include a deduction for depreciation. Replacement cost coverage costs more—but can be well worth the extra expense when the time comes to replace your belongings.

3. What disasters are—and are not—covered?

Renters insurance covers you against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and certain types of water damage (such as when the tenant upstairs leaves the water running in the bathtub and floods out your apartment’ or from a burst pipe). Most renters insurance policies, however, do not cover floods or earthquakes. Flood coverage is available from the National Flood Insurance Program and a few private insurers.. You can get earthquake insurance as a separate policy or have it added as an “endorsement” to your renters policy, depending on where you live.

4. What is my deductible, and how does it work?

deductible is an amount of money you pay out-of-pocket before the insurance coverage kicks in. Deductibles are generally available as a specified dollar amount; the larger the deductible, the lower your insurance premium. You will be responsible for paying the deductible each time you file a claim, so keep this in mind when determining your insurance budget.

5. What is a “floater” and do I need one?

If you have expensive jewelry, furs, sports or musical equipment, or collectibles, consider adding a floater to your policy. A floater is a separate policy that provides additional coverage for your valuables if they are lost or stolen.

6. Am I covered if I am traveling or away from home?

Most renters polices include what is called off-premises coverage, meaning that belongings that are outside of your home are covered against the same disasters listed in your policy. For example, property stolen from your car or a hotel room while you’re traveling would be protected.

B. Liability Protection

1. Do I have enough liability insurance?

Renters insurance provides liability protection that covers you against lawsuits for bodily injury or property damage done by you, your family members and even your pets. This coverage pays for both the cost of defending you in court and court awards—up to the limit of your policy. Make sure the amount of liability coverage provided by your policy is sufficient to protect your assets.

Your renters policy should also include no-fault medical coverage as part of the liability protection. Medical payments coverage allows someone who gets injured on your property to simply submit his or her medical bills directly to your insurance company so the bills can be paid without resorting to a lawsuit.

2. Do I need an umbrella liability policy?

If you need a larger amount of liability protection, consider purchasing a personal umbrella liability policy. An umbrella policy kicks in when you reach the limit on the underlying liability coverage provided by your renters or auto policy. It will also cover you for things such as libel and slander.

C. Additional Living Expenses

What happens if I can’t live in my home after a disaster?

If your home is destroyed by an insured disaster and you need to live elsewhere, renters insurance provides additional living expenses (ALE) coverage, which pays for hotel bills, temporary rentals, restaurant meals and other expenses you incur while your home is being repaired or rebuilt.

D. Discounts

Insurance companies often offer discounts on renters insurance if you have another policy with them for your car or business. You can also get discounts if you:

Have a security system

Use smoke detectors

Use deadbolt locks

Have good credit

Have multiple policies

Stay with the same insurer

Are over 55 years old 

Companies offer several types of discounts, but these can vary widely by company and by state, so review your options carefully. As always, the same rule-of-thumb applies: Shop around for the best deal.

Our Baldwin / Welsh & Parker (BWP) are happy to be of assistance and can help you find the best options!

 

Source: Insurance Information Institute (I.I.I.)

Published in Blog

home biz2

From IIABA’s Trusted Choice Blog.

Are you the proud owner or founder of one of the estimated 59% of established businesses in the United States that operate from a home?

There are often concerns, considerations, and risks unique to a home-based environment. Baldwin / Welsh & Parker Insurance (BWP) can help you construct the proper protection by reviewing your current insurance and risk management programs.

Studies show that of the 11 million-plus home-based businesses, nearly 60% do not have insurance specifically recognizing and providing coverage for these unique risks. When asked about the reasons for this lack of additional insurance, business owners responded:

  • They thought they were already properly covered by their personal insurance: 40%.
  • They thought their business was too small to insure: 30%.
  • They could give no specific reason: 20%.

The first assumption is demonstrably false. The second assumption above is also wrong, and the third response, at a minimum, shows a dangerous lack of knowledge.

Four Common Risks not Covered

Standard homeowners policies are designed for personal exposures, not business. While there may be small areas or limits of coverage available for certain types of home-based businesses, the vast majority will find coverage severely limited or specifically excluded for business losses related to these four common risks:

1) Theft,

2) Vehicle usage,

3) Employee injuries, or

4) Life/health/disability.

The largest potential gap in proper coverage arises from the lack of liability protection for claims arising out of business activities, whether the claim occurs in the home or elsewhere.

Protect Your Assets

Starting and running a home-based business may be the first step on your road to successful entrepreneurship. Whether your business ultimately remains in your home or grows into the need for outside facilities or a relocation, your Baldwin Welsh & Parker (BWP) Trusted Choice® agent stands ready to be your ongoing valued partner. Schedule a time today to review your current or future business plans, and let us help you establish a comprehensive insurance and risk management program to protect what we both hope will be your most valuable growing asset.

Published in Blog

auto accidents

The New Epidemic.

Activities that take drivers’ attention off the road, including talking or texting on mobile devices, eating, conversing with passengers, adjusting mirrors or the radio, and other distractions, are a major safety threat.

Distracted driving is now a public health crisis in the United States. Cell phone use while driving whether it is hands free or not, has been followed with accidents, injuries, and fatalities rising at alarming rates!

According to the US Department of Transportation, cell phones are now involved in 1.6 million auto crashes each year, injuring 500,000 people and causing 6,000 deaths.

With this historic increase in crash fatalities over the past two years, the Massachusetts Executive Office of Public Safety and Security traffic shares the recently launched Highway Safety Division (HSD) “Drive Present” campaign, to stress to drivers the importance of focusing on the road and not on their phones. Driving present is about being engaged in the moment: aware of your surroundings, ready to react when the situation changes. When you’re behind the wheel, you owe it to the people you love to focus only on the task at hand. Why? Because they’re counting on you to make it home safe.

Distracted drivers pose a deadly risk to everyone on the road. Here are 9 tips for managing some of the most common distractions. 

  1. Turn it off. Turn your phone off or switch to silent mode before you get in the car.
  2. Spread the word. Set up a special message to tell callers that you are driving and you’ll get back to them as soon as possible, or sign up for a service that offers this.
  3. Pull over. If you need to make a call, pull over to a safe area first.
  4. Use your passengers. Ask a passenger to make the call for you.
  5. X the Text. Don’t ever text and drive, surf the web or read your email while driving. It is dangerous and against the law in most states.
  6. Know the law. Familiarize yourself with state and local laws before you get in the car. Some states and localities prohibit the use of hand held cell phones. GHSA offers a handy chart of state laws on its website: www.ghsa.org/html/stateinfo/laws/cellphone_laws.html.
  7. Keep the kids safe. Pull over to a safe location to address situations with your children in the car.
  8. Secure your pets. Pets can be a big distraction in the car. Always secure your pets properly before you start to drive.
  9. Focus on the task at hand. Refrain from eating, drinking, smoking, reading and any other activity that takes your mind and eyes off the road.

 Source: the Massachusetts Executive Office of Public Safety and Security website.

Published in Blog
Friday, 28 April 2017 14:44

How much homeowners insurance do I need?

House

A terrific article from the I.I.I. - Insurance Information Institute

You need enough insurance to cover the following: 

  1. The structure of your home.
  2. Your personal possessions.
  3. The cost of additional living expenses if your home is damaged and you have to live elsewhere during repairs.
  4. Your liability to others.

1. The structure

You need enough insurance to cover the cost of rebuilding your home at current construction costs. Don't include the cost of the land. And don't base your rebuilding costs on the price you paid for your home. The cost of rebuilding could be more or less than the price you paid or could sell it for today.

Some banks require you to buy homeowners insurance to cover the amount of your mortgage. If the limit of your insurance policy is based on your mortgage, make sure it's enough to cover the cost of rebuilding. (If your mortgage is paid off, don't cancel your homeowners policy. Homeowners insurance protects your investment in your home.)

For a quick estimate of the amount of insurance you need, multiply the total square footage of your home by local building costs per square foot. To find out construction costs in your community, call your local real estate agent, builders association or insurance agent.

Factors that will determine the cost of rebuilding your home:

  • Local construction costs
  • The square footage of the structure
  • The type of exterior wall construction–frame, masonry (brick or stone) or veneer
  • The style of the house (ranch, colonial)
  • The number of bathrooms and other rooms
  • The type of roof and materials used
  • Other structures on the premises such as garages, sheds
  • Fireplaces, exterior trim and other special features like arched windows
  • Whether the house, or parts of it like the kitchen, was custom built
  • Improvement to your home–adding a second bathroom, enlarging the kitchen or other additions that have added value to your home

Standard homeowners policies provide coverage for disasters such as damage due to fire, lightning, hail, explosions and theft. They do not cover floods, earthquakes or damage caused by lack of routine maintenance.

Contact Baldwin / Welsh & Parker for more information on flood or earthquake coverage.  

2. Replacement cost policies
Most policies cover replacement cost for damage to the structure. A replacement cost policy pays for the repair or replacement of damaged property with materials of similar kind and quality. There is no deduction for depreciation–the decrease in value due to age, wear and tear, and other factors.

If you purchase a flood insurance policy, coverage for the structure is available on a replacement cost basis.

3. Guaranteed or extended replacement cost coverage
After a major hurricane or a tornado, building materials and construction workers are often in great demand. This can push rebuilding costs above homeowners policy limits, leaving you without enough money to cover the bill. To protect against such a situation, you can buy a policy that pays more than the policy limits.

An extended replacement cost policy will pay an extra 20 percent or more above the limits, depending on the insurance company. A guaranteed replacement cost policy will pay whatever it costs to rebuild your home as it was before the fire or other disaster.

4. Building codes
Building codes are updated periodically and may have changed significantly since your home was built. If your home is badly damaged, you may be required to rebuild your home to meet new building codes. Generally, homeowners insurance policies (even a guaranteed replacement cost policy) won't pay for the extra expense of rebuilding to code. Many insurance companies offer an Ordinance or Law endorsement that pays a specified amount toward these costs. (An endorsement is a form attached to an insurance policy that changes what the policy covers.)

5. Inflation guard
Consider adding an inflation guard clause to your policy. This automatically adjusts the dwelling limit when you renew your policy to reflect current construction costs in your area.

6. Older homes
If you own an older home, you may not be able to buy a replacement cost policy. Instead, you may have to buy a modified replacement cost policy. This means that instead of repairing or replacing features typical of older homes, like plaster walls and wooden floors, with similar materials, the policy will pay for repairs using the standard building materials and construction techniques in use today.

Insurance companies differ greatly in how they insure older homes. Some won't insure older homes for the replacement cost because of the expense of re-creating special features like wall and ceiling moldings and carvings. Other companies will insure older homes for the replacement cost as long as the dwelling is in good condition.

If you can't insure your home for the replacement cost or choose not to do so–in some cases, the cost of replacing a large old home is so high that you might not want to replace it with a house of the same size–make sure the limits of the policy are high enough to provide you with a house of acceptable size and quality.

7. Your personal possessions

Most homeowners insurance policies provide coverage for your personal possessions for approximately 50 percent to 70 percent of the amount of insurance you have on the structure or “dwelling” of your home. The limits of the policy typically appear on the Declarations Page under Section I, Coverages, A. Dwelling.

To determine if this is enough coverage, you need to conduct a home inventory. This is a detailed list of everything you own and information related to the cost to replace these items if they were stolen or destroyed by a disaster such as a fire. There are several products available to help perform this task, including the I.I.I.'s free Know Your Stuff® Home Inventory Tool that lets you to create and maintain a home inventory on any digital device or computer and safely store it online for easy, secure access--anywhere, anytime.  If you think you need more coverage, contact your agent or insurance company representative and ask for higher limits for your personal possessions.

8. Replacement Cost or Actual Cash Value
You can either insure your belongings for their actual cash value, which pays to replace your home or possessions minus a deduction for depreciation up to the limit of your policy. Or you can opt for replacement cost, which pays the actual cost of replacing your home or possessions (no deduction for depreciation) up to the limit of your policy.

Suppose, for example, a fire destroys a 10-year-old TV set in your living room. If you have a replacement cost policy for the contents of your home, the insurance company will pay to replace the TV set with a new one. If you have an actual cash value policy, it will pay only a percentage of the cost of a new TV set because the TV has been used for 10 years and is worth a lot less than its original cost. Some replacement cost policies also replace the item and deliver it to you.

Generally, the price of replacement cost coverage is about 10 percent more than that of actual cash value. If you need a flood insurance policy for your belongings, it is only available on an actual cash value basis.

9. Insuring expensive items with floaters/endorsements
There may be limits on how much coverage you get for expensive items such as jewelry, silverware and furs. Generally, there is a limit on jewelry for $1,000 to $2,000. You should ask your agent or look it up in your policy. This information is in Section I, Personal Property, Special Limits of Liability. Insurance companies may also place a limit on what they will pay for computers.

If the limits are too low, consider buying a special personal property floater or an endorsement. These allow you to insure these items individually or as a collection. With floaters and endorsements, there is no deductible. You are charged a premium based on what the item (or collection) is, its dollar value and where you live.

You can determine the value by providing your agent with a recent receipt or getting the item or collection appraised.

10. Additional living expenses after a disaster

This is a very important feature of a standard homeowners insurance policy. This pays the additional costs of temporarily living away from your home if you can't live in it due to a fire, severe storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt.

Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house. Some companies will even sell you a policy that provides you with an unlimited amount of loss of use coverage, for a limited amount of time.

If you rent out part of your house, this coverage also reimburses you for the rent that you would have collected from your tenant if your home had not been destroyed.

You should talk to your agent or company to make sure you know exactly how much coverage you have and how long the coverage will be in effect. In most cases, you can increase this coverage for an additional premium.

11. Liability to others

This part of your policy covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by pets. It pays for both the cost of defending you in court and for any damages a court rules you must pay.

Generally, most homeowners insurance policies provide a minimum of $100,000 worth of liability insurance, but higher amounts are available. Increasingly, it is recommended that homeowners consider purchasing at least $300,000 to $500,000 worth of coverage of liability protection.

12. Umbrella or Excess Liability.
You should buy enough liability insurance to protect your assets. If you own property and or have investments and savings that are worth more than the liability limits in your policy, you may consider purchasing an excess liability or umbrella policy.

Umbrella or excess liability policies provide extra coverage. They start to pay after you have used up the liability insurance in your underlying home (or auto) policy. An umbrella policy is not part of your homeowners policy. You have to purchase it separately. In addition to providing a higher dollar amount, they offer broader coverage. You are covered for libel, slander, and invasion of privacy. These things are not covered under standard homeowners or auto policies.

The cost of an umbrella policy depends on how much underlying insurance you have and the kind of risk you represent. The greater the underlying liability coverage, the cheaper the policy. This is becaue you would be the less likely to need the additional insurance. Most companies will require a minimum of $300,000 on your home and your car, if you own one.

Published in Blog
Thursday, 27 April 2017 21:09

8 Home Security Tips You Never Thought Of

8 home security tips

From our Trusted Choice friends by Sheena Tatum

Your home is your sanctuary. It is a place where fond memories are made and relaxing evenings are spent after a busy day. Your home is a safe haven where you and your family most feel at ease. If your home is under-protected or you've had a recent burglary, this may compromise the security you feel in your own home.

Recent FBI reports reveal that here were an estimated 8,277,829 property crimes (burglaries, larceny-thefts, and motor vehicle thefts) reported by law enforcement. Financial losses suffered by victims of these crimes were calculated at approximately $14.3 billion. Larceny-theft accounted for 70.8 percent of all property crimes reported, burglary for 20.9 percent, and motor vehicle theft for 8.3 percent

While that number is down from the previous year, it is still a statistic that no one wants to become a part of. Using a few simple home security tips and tricks, you can protect your belongings, thwart would-be thieves and increase your feeling of security while home and away.

Prevention begins outside your home from the minute it comes into view. Take a walk around your property with a critical eye to see what changes it needs. Here are a few you may have missed:

1. Don't provide places for thieves to hide: Trim trees and bushes that may give someone a place to hide or unnoticeable access to your windows. You should trim back any shrubs that are high enough to block a window.

You will also want to consider the lighting of your property. Look for places around your home that are very dark and may allow a thief access to your home under the cover of darkness. Consider installing lights in various places that can light up entrances. Motion detection spotlights are the best option to conserve energy and not annoy your neighbors or yourself with the bright lights.

2. Don't let thieves know you are not home: If you are planning to go on vacation, never announce it beforehand. We are a society that likes to share, and thieves love that about us. Sending a tweet that you've arrived at the airport or posting a status update on Facebook indicating that you can't wait to leave for your cruise is a great way to alert thieves that your home is empty. Save all updates about your vacation and picture sharing for when you return.

In addition, if you are planning to vacation, have a trusted friend or neighbor stop by every day to pick up the mail, newspapers and any fliers that may be left at the door. If a flier has been sitting on your front door for days, a thief could take notice and know you are on an extended leave.

Any time you are going to be gone during the night, even if it's just returning from work after it gets dark, you should have interior lights set to a timer. Having lights on will keep thieves guessing and will let you feel safer when you come home.

3. Keep your yard clean to prevent giving thieves an advantage: Many times, thieves will gain access to your home through a window they have broken. It is best that we don't give them a tool to do that. Clean up your yard of broken tree limbs after a storm. Ensure your kids put away their toys after playing outside. Never leave a ladder outside in the yard; a thief could use your ladder to gain access to a higher window that is more likely to be unlocked. Use the same precautions for tools, whether they are gardening or for the barbecue; lock them up when they aren't in use.

4. Install a home alarm system: While an alarm may not keep burglars from getting inside your home, it will deter some and bring the police to your home quickly, limiting what a thief is able to take. Home security systems will only work if you always remember to engage the alarm. You should have your alarm engaged while you are away or while you are at home as many thieves will attempt to break into one part of your home while you are busy in another. Also, some insurance companies may lower your home insurance premiums for having a home alarm system installed.  Check with one of our BWP Trusted Choice agents!

5. Take precautions to protect windows: If you are purchasing new windows for your home, it might be worth the upgrade to buy shatterproof glass. This would prevent anyone from breaking a window to gain access to your home. If new windows aren't in the budget, consider adding a security film to windows. This will prevent the glass from shattering upon breaking and may deter thieves from continuing their attempt to break in.

6. Secure sliding glass doors: Sliding glass doors have incredibly flimsy locks. A thief can easily pop them in an instant, giving quick access to your home. Installing a security bar for sliding doors would make gaining access to your home more difficult. This measure of protection is a must-have for all sliding doors and windows.

7. Always lock doors and windows: Keep windows locked when you are not home, when you go to bed at night and when they are not in use. If you like to sleep with a window open at night, install window locks that only allow the window to open a few inches.

You should also keep your garage door down, even during the day. Having the garage door open invites thieves inside to look around. It gives them quick, easy access inside your home. Even if they can't take something at the time, they can get enough of a look to see if your home is worth a visit later.

8. Change the locks as necessary: If you've just purchased a home from someone, your first order of business should be to meet the locksmith at your new home. You have no idea who is out there with a key just waiting for the moment to use it. In addition, if you've had a breakup recently, it is time to change the locks. The person may give you the key back, but you have no idea how many copies are out there. Having the locks changed is good for the peace of mind.

Keeping your family, your belongings and your home safe and secure does not involve a lot of money. A few simple changes such as the home security tips mentioned above can protect everyone and everything for years to come.

Published in Blog
Wednesday, 12 April 2017 05:08

Hands-free is not Risk-free

  • Hands-free Devices: False Sense of Security


    ​From the National Safety Council

    Think using a hands-free device while driving makes you safer? Think again. You may be surprised at how this NSC infographic shows the cell phone conversation is distracting. In order to stay safe, you need your eyes on the road, your hands on the wheel, and your mind on driving.


  • Hands-free is not risk-free


 

Published in Blog
Wednesday, 12 April 2017 05:03

The #1 Cause of Workplace Death

  • From the National Safety Council

 

April is National Distracted Driving Month and here are important resources to share!

Did you know the leading cause of workplace death is car crashes? NSC estimates aquarter of crashes involve cell phones. Learn more about this workplace danger in this infographic and how employers can take the lead by putting cell phone policies in place. 


 
 
 


Published in Blog
Wednesday, 12 April 2017 04:25

5 Common Tax Breaks for Business Owners


 
Common tax breaks for business owners.

Many people today are enjoying the benefits of being their own boss and running their own company. According to the U.S. Census, there are currently more than 5 million companies with fewer than 20 people actively operating in this country. Whether you freelance or you have created a company that employs others, you can take advantage of a variety of tax deductions on your business income.

Owners of large corporations have accountants and tax experts working for them, but many small-business owners and freelancers cannot afford that added expense. If you complete your tax returns on your own each year, make sure that you are aware of the tax deductions you can use to save. Some of the most common business deductions are listed below.


Home office

According to Entrepreneur Magazine, approximately 52 percent of all businesses in America are operated out of the business owners’ homes. The home office deduction, therefore, is one that may be useful to many.

Of all available business-related tax deductions, this one is the most complicated. You can deduct a portion of your heating, cooling, home insurance, and rent or mortgage costs from your taxable income, based on the percentage of your home that is used for business purposes only. Recent changes in the tax code have simplified the calculation of this deduction by allowing business owners to opt to deduct $5 per square foot of office space, up to 300 square feet.

To be eligible for this deduction, you must have a room that is used for work-purposes only. If your computer is set up in a guest bedroom, for example, you may not deduct the entire room as a home office.

If the portion of your home that is used for your business is very small, many tax advisors will recommend that you forego this deduction. This is because the amount of money you will save will be minimal and not worth the complications that may arise because of an audit. If you are uncertain whether this business deduction is right for you, speak with a lawyer or tax advisor before making a decision.


Office Supplies

Whether or not you are deducting a home office from your taxes, you may deduct the cost of office supplies that you use in the course of your business. This includes everything from pens and pencils to toner cartridges for your printer. Be sure to save all your receipts. Many people find it very helpful to have a credit card that is used strictly for business purposes.

Some examples of things you may deduct include:

  • Writing materials including pens, pencils, markers and highlighters
  • Paper, notebooks, file folders, binders and notebooks
  • Business cards, stationery and promotional items with your business name on them
  • Office furniture, file cabinets and desktop telephones
  • Computers, flash-drives, recordable CDs and software
  • Envelopes, postage and packing supplies

Internet Connection and Phone

If you rely on email and internet use as a part of your daily business operations, you may deduct the cost of your internet service from your taxable business income. The same holds true for your land-line or cell phone service if your phone number is your business line. This includes cell phones that have a data plan.

Unlike a home office, it is not necessary that you use your internet or phone service for business purposes only. This is because your service most likely comes at a flat fee, regardless of usage.


Health Insurance Premiums

The newly established Affordable Healthcare Act requires business owners who have more than 50 full-time employees to provide them with affordable healthcare options. Policies may be purchased by business owner or individuals at lower group rates through the healthcare exchanges set up by each state. For information about this is being offered by the SBA through scheduled webinars.

Whether you are providing health insurance to your employees or you are simply purchasing a policy on your own, you may be able to deduct 100 percent of the incurred expenses from your business income. However, there are some caveats:

  • If your healthcare expenses exceed your business’s net profits, you may only deduct an amount equal to net profit.
  • If you are eligible for healthcare coverage through your spouse, you may not deduct the cost of purchasing your own coverage.

If your spouse works for you, you may deduct 100 percent of the cost of insuring him or her as well as your children, but your spouse must be an actual, documented employee of your company and you must offer the same health insurance coverage plans to all of your employees.


Mileage

People who drive frequently in the course of business are most likely to be aware of this deduction, but those who drive only on occasion often overlook it. If you make trips for supplies or to make deliveries, or if you drive somewhere to meet with a current or prospective client, you are entitled to deduct the mileage you have accrued while doing so.

If you plan to take this deduction, it is imperative that you keep extremely good records of your business-related driving. Record the date, your destination, the exact number of miles driven, and the purpose of your trip in a log or journal. When compiling your taxes, add up the number of miles driven. For 2013 tax purposes, you are entitled to deduct 56.5 cents per mile driven. This deduction includes fuel costs so you may not deduct the cost of gasoline as well.


Business Travel Expenses

If you take a business trip, such as to attend a conference or to meet with an important client who lives out of town, you may deduct the associated costs from your business income. These costs include:

  • Mileage driven
  • Airfare, train or other transportation costs
  • Hotel charges
  • Meals
  • Entertainment costs, if entertaining a client

Be aware that travel and hotel costs are 100 percent tax-deductible, but meals and entertainment costs are only 50 percent deductible. Also, you are permitted to deduct the cost of a gift to a client or employee but only up to $25 per person.

Published in Blog

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