A lot of business owners think, “If I buy this $10,000 piece of equipment, I’ll save $10,000 in taxes.”
Not true.
A tax write-off reduces your taxable income, not your tax bill dollar-for-dollar.
Here’s the real math:
If you’re in roughly a 30% tax bracket (25% federal + 5% state), a $10,000 deduction saves you about $3,000 in taxes.
You’re still spending $7,000 of your own money.
So before you rush out to buy a new oven, mower, computer, or office equipment “for the write-off,” ask yourself:
Do I actually need this?
Is spending $7,000 worth saving $3,000 in tax?
A good write-off is still spending real money. Make sure the purchase serves your business—not just your tax return.
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