Taxes
I am a therapist, not a CPA. These are the steps that I take when I file my taxes. This is for educational purposes only, please consult with a professional before proceeding :)
My fav tax/ CPA resource for therapists: Simple Profit for Mental Health Therapists
First, if you plan to do your own accounting, I highly recommend getting a program like Wave or Mint to help you stay sorted between your business and personal expenses and it will also keep track of income for you.
Getting a bank account like Novo will also help you file away a percentage for your taxes into a reserve account so you aren’t scrambling in the next quarter.
For private practice owners, there are quite a few things that you can write off on your taxes.
What will your tax form look like? You can find the form here: https://www.irs.gov/pub/irs-pdf/f1040sc.pdf
So using the same numbers as the form above, you will have the following categories of business expenses (I deleted the ones I don’t use as a single owner with no employees):
Categories of approved business write-offs
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Mail and print ads
Online advertising
Website design and maintenance
Professional headshots
Logo design
SEO tools or consultation
Business cards
Brochures
Sponsorships
Promotional items like pens or notepads
Monthly fees for directory listings (e.g. Psychology Today) -
Any bank fees (be sure not to count these twice)
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Health insurance
Retirement plan
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Other than health insurance (i.e. professional liability insurance)
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Supervision for pre-licensed clinicians
CPA
Legal services
Biller
Virtual assistant
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Item descriptionWebsite
Internet hosting fees
Domain name
Web software (EHR, CRM, booking & billing, telehealth, dropbox, etc)
Email service
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Yes, you can write off part of your home rent/ mortgage. It’s by squarefoot of your dedicated office space. Part of a multi-use room (office in a bedroom) counts.
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Remember, this is strictly business equipment related.
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Cleaning
Postage
Books & magazines
File cabinet etc
Small furniture (<$2500)
Stationery
Computers, printers, photocopiers, phones, etc.
Printer or photocopier ink or toner
Printer paper
Artwork
Storage bins -
For therapists: this includes your license renewal fee
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Think anything to do with networking too! Or a retreat you attend.
A) Travel
- Mileage
- Parking
- Baggage fees
- Rental car costs
- Laundry and drycleaning
B) Meals
- While traveling for business
- Business-related meetings (consultation, meeting with client) -
Yes, even if you WFH. Count up to 1/3 of your internet, light, water, and gas bills.
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It’s better to fit any of these into the other categories first.
- Membership fees (e.g. APA, NASW)
- Credit card processing fees
- Bank fees (for your business account)
- Overdraft fees
- Maintenance fees
- Continuing education
- Supervision costs
- Books, journals, and trade magazines related to your field
- Learning supplies (stationery, note-taking apps, etc.)
My tax guy said I could count my personal therapy here or under professional services. There is definitely some disagreement in our field about that so please contact a CPA.
