how do tax write offs work?

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how do tax write offs work?

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It decreases your tax burden. Lets say you’re a company makes books; you sold $1000 last year. Without any write-offs you’d owe taxes on on $1000. But you had to buy paper for $100, your electricity was $100, you paid $150 to fix your printer and you paid your employees $200. Those expenses are subtracted from your revenue and you end up paying taxes on $450 instead of $1000.