Many business owners leave thousands of dollars on the table each year simply because they don’t know what they can deduct. The tax code is full of opportunities—but it’s also easy to overlook legitimate deductions when you’re focused on running your business instead of analyzing receipts.
Here are the top tax deductions business owners commonly miss, and how to make sure you take advantage of them this year.
1. Home Office Expenses
If you use part of your home exclusively for business, you may be able to deduct a portion of:
- Rent or mortgage interest
- Utilities
- Internet
- Repairs or maintenance
- Property taxes
- Homeowners insurance
Even small home office deductions add up—and the simplified square-foot method makes it easy.
2. Mileage and Car Expenses
Many owners forget to track mileage, but it can be one of the biggest deductions. You can deduct:
- Miles driven for client meetings
- Business errands
- Travel between work sites
- Trips to the bank or post office
If you don’t track mileage in real time, you’re almost guaranteed to miss out.
3. Cell Phone and Internet Costs
If you use your phone for business (calls, email, scheduling, apps), a portion of your bill is deductible. The same applies to your internet service. Most business owners pay for these services personally and forget to claim them.
4. Professional Services
You can fully deduct professional fees such as:
- Accounting
- Tax preparation
- Legal advice
- Fractional CFO services
- Business consulting
These are necessary expenses—and they reduce your tax liability.
5. Software, Subscriptions, and Online Tools
From QuickBooks to CRM tools to design apps, many business owners forget how many digital services they pay for throughout the year.
You can deduct:
- Cloud storage
- Project management platforms
- Email marketing tools
- Website hosting and domain costs
- Cybersecurity services
These small monthly fees add up to a large deduction.
6. Retirement Contributions
Many business owners forget to maximize retirement contributions, which can dramatically lower taxable income.
Depending on your structure, you may be eligible for:
- SEP IRA
- Solo 401(k)
- SIMPLE IRA
These plans not only reduce taxes but also build long-term financial security.
7. Startup Costs and Organizational Expenses
If your business is new, you can deduct many of your initial costs, including:
- Legal fees
- Training
- Marketing
- Business formation costs
Most owners don’t realize these can be deducted even before the business officially starts operating.
8. Business Meals
Meals with clients, prospects, or business partners are deductible when they serve a legitimate business purpose.
Just make sure you:
- Document who attended
- Note the purpose of the meeting
- Keep the receipt
These small but frequent expenses are often forgotten.
9. Education and Training
If you take courses or attend conferences that improve your skills, you can deduct:
- Registration fees
- Books and materials
- Travel expenses
- Online courses
- Seminars or certifications
Any education connected directly to your business can be a deduction.
10. Health Insurance Premiums (For Self-Employed)
If you pay for your own health insurance, the premiums are often deductible—even if you don’t itemize deductions.
This can include:
- Medical
- Dental
- Vision
- Premiums for family members
This is a major deduction self-employed owners frequently overlook.
11. Bad Debts
If you invoiced a client who never paid and it’s now uncollectible, you may be able to deduct it as a bad debt (depending on your accounting method).
Many owners simply move on—but forget they can reduce taxable income in the process.
12. Interest and Bank Fees
Fees you pay for banking, loans, credit cards, or lines of credit are all deductible, including:
- Interest on business loans
- Credit card processing fees
- Monthly bank account fees
Even small amounts add up across the year.
Final Thoughts
Tax deductions can significantly lower your tax bill—but only if you know they exist and track them throughout the year. Many business owners rely solely on their year-end receipts and miss dozens of opportunities to save.
A Fractional CFO or tax professional can help you:
- Identify missing deductions
- Organize expenses properly
- Plan proactively instead of reactively
- Keep more of what your business earns
The money you save often more than pays for the guidance you receive.
