10 Tax Deductions Every Small Business Owner Should Know
10 Tax Deductions Every Small Business Owner Should Know
As a small business owner, understanding tax deductions can significantly reduce your tax liability and improve your bottom line. Here are 10 essential deductions you shouldn't miss:
1. Home Office Deduction
If you use part of your home exclusively for business, you may qualify for the home office deduction. This includes a portion of rent/mortgage, utilities, insurance, and maintenance costs.
2. Business Vehicle Expenses
Track mileage or actual expenses for vehicles used for business purposes. The standard mileage rate for 2025 is 67 cents per mile.
3. Health Insurance Premiums
Self-employed individuals can deduct 100% of health insurance premiums for themselves, their spouse, and dependents.
4. Retirement Contributions
Contributions to SEP-IRAs, SIMPLE IRAs, or solo 401(k)s are tax-deductible and help you save for the future.
5. Professional Services
Fees paid to accountants, lawyers, consultants, and other professionals are fully deductible.
6. Office Supplies and Equipment
Everything from pens and paper to computers and furniture can be deducted, either immediately or through depreciation.
7. Marketing and Advertising
Website costs, social media ads, business cards, and other marketing expenses are 100% deductible.
8. Business Insurance
Premiums for general liability, professional liability, and other business insurance policies are deductible.
9. Education and Training
Costs for courses, conferences, and training that maintain or improve skills required in your business are deductible.
10. Business Meals
You can deduct 50% of business meal expenses when discussing business with clients or employees.
Keep Good Records
The key to maximizing deductions is maintaining detailed records throughout the year. Use accounting software and save all receipts.
Need help identifying deductions for your business? Contact SmartBooks Accounting for a free consultation.