Is General Liability Insurance Tax Deductible

General liability insurance covers third-party accidents and injuries.

For instance, if a customer trips over wires in your shop during renovations, the insurance pays for medical bills and potential lawsuits.

Consider it the foundation of your business protection, necessary regardless of your industry. Without it, legal claims could deplete your finances.

General Liability Insurance Tax Deductible
General Liability Insurance Tax Deductible: Photo source (Insuranks)

Having this insurance not only safeguards your assets but also instills confidence in clients, potentially leading to better opportunities.

Is General Liability Insurance Tax-Deductible?

General liability policy payments are typically eligible for tax deductions, as the IRS views them as business expenses.

It’s crucial to maintain a record of all payments made for your policy, as this information is essential for your annual tax filing.

However, it’s important to note that consulting with an accountant or tax expert is advisable when handling your business taxes.

Their expertise can ensure that your general liability policy payments are correctly accounted for as deductibles.

Is General Liability Coverage Based on Payroll?

The cost of your general liability coverage policy is influenced by your payroll expenses.

When seeking quotes from Simply Business, having an accurate estimate of your annual payments to employees (including subcontractors) is crucial.

Even if it’s an approximation, this information helps us assess the appropriate type of general liability policy for your needs.

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