Top 7 Tax Deductions Business Owners Forget Every Year

Most business owners end up paying more than their fair share of taxes because they forget which expenses qualify for deductions.

The main reason business owners pay more in taxes than they need to is their inability to remember which expenses qualify for deductions.

The daily operational demands of running a business make it simple to miss essential expenses, which could result in substantial tax savings during filing season.

My mission as an accountant remains to assist business owners in retaining their earned profits throughout each year.

The following list contains seven essential tax deductions that most business owners tend to overlook during their annual tax preparation.

1. The Home Office Deduction for Home Office Expenses

Business owners who work from home exclusively for their business operations can claim the home office deduction as a tax benefit.

The following expenses qualify for deduction when you work from home:

• The cost of renting or owning your home, along with interest payments on your mortgage.

• The costs of electricity, internet services, and water consumption.

• The costs for home maintenance work and repair services.

• The cost of office furniture and equipment.

The IRS requires businesses to prove their expenses meet two criteria: they must be both necessary and ordinary to their operations.

(Source: IRS Publication 334 – Small Business Tax Guide)

The workspace needs to serve as an exclusive work area, as it cannot function as a personal space like a guest room.

2. Vehicle Mileage & Business Travel

The total number of business miles you drive between client meetings, vendor visits, and networking events should be recorded for tax purposes.

You can choose between using the IRS-approved standard mileage rate of 67 cents per mile for 2024 or calculating your actual business expenses, including fuel, maintenance, insurance, and depreciation.

Your business can deduct all business-related miles, regardless of trip length, but you need to maintain accurate mileage records. The QuickBooks Self-Employed app, together with MileIQ, provides users with simple ways to track their business miles.

(Source: IRS Standard Mileage Rates)

3. Continuing Education & Training

Your business can deduct expenses for professional development when you enroll in certifications and online courses and attend conferences and workshops that enhance your business abilities.

The following items qualify as deductible expenses for business purposes:

• Webinars 

• Coaching programs

• Industry memberships

•  Educational materials

•  Software upgrades.

The costs of learning new skills through education represent an excellent business investment that your company can deduct from its taxes.

4. Marketing, Branding & Professional Services

The most commonly overlooked tax deductions I encounter belong to advertising expenses and professional service fees.

The following expenses qualify for deduction under this category:

• The costs of website development, maintenance, and hosting services.

• Social media advertising expenses and content creation fees.

• Business promotion expenses include printed materials such as business cards and flyers, as well as digital marketing solutions.

• The costs of accounting services, legal advice, and consulting services.

All expenses that help your business grow or maintain compliance with regulations qualify as deductible items. (Source: NerdWallet Small Business Deductions Guide)

5. Software & Subscriptions

Every business operating in 2025 requires payment for essential tools that qualify as deductible expenses for tax purposes.

The following list includes deductible expenses for your business:

• QuickBooks, Wave, and FreshBooks represent three examples of accounting and invoicing software.

• Canva and Adobe serve as design and content creation tools.

• Asana and Trello operate as project management applications.

• Your business can deduct expenses for cloud storage services and Customer Relationship Management systems.

Record all your business expenses for tax purposes so you can claim them with confidence.

6. Retirement Contributions

Your tax bill reduction through this deduction will also help you build up your retirement savings.

Self-employed business owners and small business operators can deduct their retirement account contributions to SEP IRAs, Solo 401(k) s, and Simple IRAs.

Self-employed individuals can make significant contributions to their retirement accounts because the IRS allows it, helping them save on taxes and build their retirement funds.

(Source: IRS Retirement Plans for Small Businesses)

7. Charitable Contributions (Business Giving)

Your business can receive tax benefits through charitable donations to qualified organizations, including funds, sponsorships, or donated items.

Corporations can deduct their donations directly from their tax bill. The deduction for charitable contributions appears on Schedule A of your personal tax return when you operate as a sole proprietorship or partnership.

The IRS allows self-employed individuals to deduct their retirement account contributions from their taxable income. Your generosity will have a positive impact while reducing your taxable income, benefiting your financial situation and emotional well-being.

🔍 Bonus Tip: Review “Ordinary and Necessary” Every Year

The IRS establishes business expense deductions under two criteria: expenses must be both ordinary and necessary for your business operations.

The IRS requires businesses to prove their expenses serve two purposes: they must be standard practices in your industry, and they must provide actual value to your operations.

All business expenses that help your operations or growth should be documented for potential deduction. Your accountant should review your documentation during tax filing to confirm your deductions.

Final Thoughts

Your dedication to earning income should help you maintain the maximum amount you earn.

Business owners fail to claim their eligible deductions because they spend too much time on their work and fear making errors during the process.

You can handle tax season with confidence by tracking expenses regularly, organizing your finances, and planning.

Your Next Step

If you have any questions or need some guidance, schedule a Tax Deduction review with us. Visit www.parksprojectsnj.com to book the free consultation.

We will work together to:

✅ Examine all your financial documents and receipts

✅ Discover all possible deductions that you have not claimed

✅ Create your tax strategy for the end of 2025

Let us be your trusted financial partner!