How to Make Your Business Greener and Receive Tax Deductions
Whether you’ve already jumped into a greener lifestyle at home or have been considering shifting your business practices to make them a little greener for a while now, there’s never been a better time to go green at the office.
On a large scale level, any attempts at being a little more “eco-friendly” will benefit a collective goal of helping keep our environment healthy and thriving. And on a more personal level, adding green initiatives to your business can directly return the benefit back to your business in the form of tax deductions. This is a major win-win for your company: good reputation with customers or clients for doing good in the world (who doesn’t like positive PR?) and less taxable income to ensure that you utilize the most money possible to further the success of your business.
After all, having a steady cash flow into your business—whether from fast business loans that fund a hot button project, cost reduction in the supply chain, or tax deductions—is essential is seeing growth. To keep your business growing, utilize a mixture of all resources out there to keep your cash flow as healthy as possible. Combine applying for a business loan when necessary with finding ways to receive tax credits and deductions for your business.
As we mentioned, one of the ways you can receive tax deductions today is with greener business practices. Here are a few green business practices you can start to implement that can help make the tax season a little easier.
Businesses that invest in solar, fuel cells, or small wind energy sources are eligible for a 30% tax credit. Or a 10% tax credit for businesses that decided to invest in geothermal, micro turbine or combine heat and power (CHP) energy sources. To be eligible for these tax credits your business must own or have built the equipment you use, and the equipment must meet certain standards and be operational the year you take the tax credit. These tax credits become a “dollar-for-dollar” reduction in the amount you owe in taxes on your gross income, based on how much you invested into a green energy source.
Have a “Green” Building
Your business can receive a tax deduction (a reduction in your taxable income) by converting to a green building. This is done by incorporating a high energy system into your business. An example of such a system is high-efficiency interior lighting (like LED lights), HVAC system, or hot water systems. In addition, you can also invest in an efficient building envelope, which consists of the walls, floors, windows, doors and roof. You can receive a deduction of up to $1.80 per square foot if the addition of these high energy systems reduces energy and power costs by 50%.
To receive green tax credits you will have to fill out an addition tax form. But the deductions can simply be added in the “other deductions” section of your regular tax return. These tax savings, along with quick business funding, can add up, providing you with valuable resources to expand and grow your company.
Other Ways to Go Green
If you’re looking to start going green on a slightly smaller scale before implementing large scale change, try one of these eco-friendly practices:
- Go paperless
- Program thermostat to turn off once everyone has left the building (if your building is empty at a certain time)
- Recycle and compost what and when you can
- Use digital marketing
- Invest in local resources when possible
- Use post-consumer waste paper and packaging
- Eliminate water bottles
- Use natural products instead of chemical products when possible
If your business is still in the process of making green changes to receive tax deductions and needs other ways to fund new projects and invest back into itself, online business funding is a simple way to kick start growth. Utilizing same day business loans online provides you with the extra resources you need to finally purchase the new warehouse equipment to make your shipping more streamlined or add a few software licenses to make sure your employees are as efficient as possible.
Going green is definitely worth the time and effort involved. Between tax deductions, stronger customer relationships, and positive environmental change there are plenty of benefits to eco-friendly business initiatives. But if you need a little extra funding now to get those or other initiatives off the ground a same day business loan can be a great help.