Running a small business comes with plenty of challenges — managing cash flow, handling employees, and, of course, keeping up with taxes. But one of the biggest missed opportunities for small business owners is failing to claim all available tax deductions. Overlooking key deductions means leaving money on the table — money that could be reinvested into your business.

Here are some of the most commonly overlooked tax deductions for small business owners and how you can make sure you’re not missing out.

1. Home Office Deduction

If you work from home, you may qualify for the home office deduction — even if you only use a portion of your home for business. To qualify, the space must be used exclusively and regularly for business purposes. You can calculate the deduction using two methods:

• Simplified Method: Deduct $5 per square foot of office space, up to 300 square feet.
• Regular Method: Calculate actual expenses (rent, utilities, insurance) based on the percentage of your home used for business.

According to the IRS, over 26 million Americans work from home, but many miss out on claiming this deduction because they aren't aware they qualify.

2. Business Mileage

If you use your personal vehicle for business, you can deduct those miles. The IRS allows a standard mileage deduction — for 2025, it's 70 cents per mile. Keep a detailed log of your business-related trips, including dates, purpose, and miles driven.

Alternatively, you can deduct actual expenses (like gas, repairs, and insurance) based on the percentage of business use.

3. Professional Services and Fees

Did you know that fees paid to an accountant, lawyer, or consultant are deductible as business expenses? If you’ve hired accountant services for small businesses, those costs are fully deductible. This includes tax preparation fees, bookkeeping services, and business consulting.

Partnering with OPTIX Accounting could not only help you manage your taxes more effectively but also reduce your overall tax burden by ensuring you’re taking advantage of every eligible deduction.

4. Retirement Contributions

Contributions to a retirement plan like a SEP IRA, SIMPLE IRA, or Solo 401(k) are tax-deductible for small business owners. For 2024, you can contribute up to 25% of your compensation to a SEP IRA, with a maximum contribution of $70,000.

This not only lowers your taxable income but also helps you build long-term financial security.

5. Employee Benefits and Education

If you provide health insurance, retirement benefits, or educational assistance to your employees, those costs are tax-deductible.

Additionally, you can deduct the cost of employee training and education, including professional development courses, conferences, and online learning platforms. Investing in your team’s growth not only strengthens your business but also reduces your tax liability.

6. Office Supplies and Equipment

Everyday expenses like paper, printer ink, and software subscriptions are deductible. Larger purchases, such as computers and office furniture, may be eligible for a Section 179 deduction, which allows you to deduct the full cost in the year of purchase instead of depreciating it over time.

7. Marketing and Advertising

All expenses related to promoting your business — from social media ads to business cards — are fully deductible. This includes the cost of website development, SEO services, and branded merchandise.

Maximize Your Tax Savings with Expert Help

Navigating small business tax deductions can be complicated, but you don’t have to do it alone. OPTIX Accounting offers expert accountant services for small businesses, helping you identify every available deduction and maximize your tax savings. Our team of experienced professionals — including some of the best Detroit tax experts — can help you with bookkeeping, business and individual tax preparation, and more.

👉 Contact OPTIX Accounting today to make sure you’re not leaving money on the table! https://www.optixaccounting.com/book-a-consultation

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