Most small business owners know about the obvious deductions — rent, payroll, supplies. But the tax code is stacked with small business tax deductions that go unclaimed every year, simply because nobody told you they existed. This is the complete list: 40+ deductions organized by category, with estimated dollar impacts and the rules you need to know.
Bookmark this page. Reference it before every year-end. And if you're not claiming at least 30 of these, you're probably overpaying.
Office and Workspace
Home Office Deduction
If you use a dedicated space in your home regularly and exclusively for business, you can deduct it. Two methods: the simplified method gives you $5/sq ft up to 300 sq ft ($1,500 max). The actual expense method deducts the percentage of your home used for business — mortgage interest, property taxes, utilities, insurance, repairs, and depreciation. For most home offices, the actual method yields $3,000–$8,000+ per year.
Rent and Lease Payments
Office rent, co-working space memberships, warehouse leases, and storage units used for business are fully deductible.
Utilities
Electricity, gas, water, trash, and internet for your business location. If home-based, the business-use percentage of these costs applies.
Internet and Phone
Business internet is fully deductible at a commercial location. For home offices, deduct the business-use percentage. A dedicated business phone line or the business-use portion of your cell phone plan qualifies too.
Vehicles and Transportation
Business Mileage
The 2026 standard mileage rate is $0.70/mile. A business owner driving 20,000 business miles per year gets a $14,000 deduction. You need a mileage log — apps like MileIQ make this automatic.
Actual Vehicle Expenses
Alternatively, deduct actual costs: gas, insurance, repairs, registration, depreciation. Multiply by your business-use percentage. For high-cost vehicles, actual expenses often beat the mileage rate.
Section 179 Vehicle Deductions
Vehicles over 6,000 lbs GVWR (most full-size SUVs, pickups, and vans) qualify for Section 179 expensing — potentially deducting the full purchase price in year one. A $60,000 SUV used 100% for business? That's a $60,000 deduction.
Parking and Tolls
Business-related parking fees and tolls are deductible on top of mileage or actual expenses.
Equipment and Technology
Computers and Electronics
Laptops, desktops, monitors, printers, tablets, and phones purchased for business use. Items under your capitalization threshold can be expensed immediately; larger purchases qualify for Section 179.
Software and Subscriptions
Accounting software, CRM, project management tools, design tools, cloud storage, and any SaaS subscriptions used for business. Fully deductible in the year paid.
Section 179 Expensing
The 2026 limit is $1.25 million for qualifying equipment, furniture, and technology. This lets you deduct the full cost in the year of purchase rather than depreciating over several years.
Bonus Depreciation
With 100% bonus depreciation restored in 2026, qualifying assets placed in service during the year can be fully deducted — even above the Section 179 limit.
People: Payroll and Benefits
Salaries and Wages
All compensation paid to W-2 employees is deductible, including bonuses and commissions.
Contract Labor
Payments to 1099 contractors — freelancers, consultants, subcontractors — are fully deductible business expenses.
Employee Benefits
Health insurance premiums, life insurance, disability insurance, and other benefits you provide to employees. These are deductible to the business and generally tax-free to the employee.
Retirement Plan Contributions
Employer contributions to 401(k), SEP IRA, SIMPLE IRA, or defined benefit plans. For solo business owners, this can shelter $70,000–$350,000+ per year depending on the plan type.
Self-Employed Health Insurance
If you're self-employed and not eligible for an employer plan, you can deduct 100% of health, dental, and long-term care insurance premiums for yourself, your spouse, and dependents. This is an above-the-line deduction — you don't need to itemize.
Payroll Taxes (Employer Portion)
The employer's share of FICA (7.65%), FUTA, and state unemployment taxes are deductible business expenses.
Marketing and Advertising
Advertising
Google Ads, Facebook/Instagram ads, print ads, radio, TV, billboards, sponsorships — all deductible. There's no dollar limit on advertising deductions.
Website Costs
Domain registration, hosting, design, development, and ongoing maintenance. SEO services and content creation count too.
Business Cards and Printed Materials
Cards, brochures, flyers, signage, branded merchandise, and direct mail campaigns.
How many of these are you actually claiming? Most business owners we meet are missing 5–10 legitimate deductions worth $10K–$50K per year. Let's find yours.
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Accounting and Tax Preparation
CPA fees, bookkeeping services, tax preparation, and tax planning fees are all deductible. The cost of tax strategy work often pays for itself many times over.
Legal Fees
Attorney fees for business-related legal work: contracts, entity formation, employment matters, lease review, trademark registration, and dispute resolution.
Consulting and Coaching
Business coaching, management consulting, and industry-specific advisory services — as long as they're directly related to your business operations.
Insurance
Business Insurance
General liability, professional liability (E&O), product liability, and commercial property insurance premiums.
Workers' Compensation
Required in most states for businesses with employees. Fully deductible.
Commercial Auto Insurance
If you deduct actual vehicle expenses (not mileage), commercial auto insurance is part of that calculation. If you have a dedicated business vehicle, the full premium is deductible.
Cyber Liability Insurance
Increasingly common and fully deductible. Protects against data breaches and cyber attacks.
Travel and Meals
Business Travel
Airfare, hotels, rental cars, rideshares, and incidentals for business trips. The trip must be primarily for business to deduct transportation costs. Keep documentation of the business purpose.
Business Meals
Meals with clients, prospects, or employees where business is discussed are 50% deductible. Keep the receipt and note who was there and what you discussed.
Per Diem
Instead of tracking actual meal expenses during travel, you can use the federal per diem rate for meals and incidentals. Simplifies record-keeping considerably.
Education and Development
Continuing Education
Courses, certifications, and training that maintain or improve skills used in your current business. An accountant taking a tax law update course? Deductible. An accountant taking a cooking class? Not deductible.
Conferences and Seminars
Registration fees, travel costs, and materials for industry conferences and professional development events.
Books, Subscriptions, and Publications
Industry publications, trade journals, business books, and professional memberships (trade associations, chambers of commerce).
Financial Costs
Business Loan Interest
Interest on loans used for business purposes — equipment financing, lines of credit, SBA loans, and business credit cards. The principal is not deductible, but the interest is.
Bank Fees and Merchant Processing
Monthly bank fees, wire transfer fees, credit card processing fees (typically 2.5–3.5% of revenue for businesses that accept cards), and payment platform fees.
Bad Debts
If you use the accrual method of accounting and a customer doesn't pay an invoice you've already recorded as income, the uncollectible amount is deductible as a bad debt.
Taxes
State and Local Business Taxes
State income taxes, franchise taxes, gross receipts taxes, and local business taxes paid on business income. Note: the $10,000 State and Local Tax (SALT) cap applies to personal returns but does not limit business deductions for pass-through entities using the Pass-Through Entity Tax (PTET) election (available in most states).
Property Taxes
Real estate taxes on business property and personal property taxes on business equipment are fully deductible business expenses.
Sales Tax on Business Purchases
Sales tax paid on deductible business purchases is part of the deductible cost.
Miscellaneous Deductions You Might Miss
Startup Costs
You can deduct up to $5,000 in startup costs in your first year of business (the rest is amortized over 15 years). This includes market research, business planning, and pre-opening expenses.
Moving Expenses for Business
While personal moving expenses are no longer deductible, costs to relocate business equipment, inventory, or operations to a new location remain a deductible business expense.
Charitable Contributions (C-Corps)
C-corporations can deduct charitable contributions up to 10% of taxable income. Pass-through entities (S-corps, LLCs, partnerships) pass charitable deductions to the owners' personal returns.
Research and Development Credit
Not a deduction but a dollar-for-dollar tax credit. If you're developing new products, processes, or software, the R&D credit can be worth $10,000–$250,000+ per year.
Energy-Efficient Building Deductions (Section 179D)
Installed energy-efficient HVAC, lighting, or building envelope improvements in a commercial building you own? You may qualify for deductions up to $5.00 per square foot under the expanded Section 179D.
The deductions exist — the question is whether you're organized enough to claim them. The most commonly missed deductions aren't obscure; they're simple expenses that never made it from a receipt to a tax return. A good bookkeeping system and a proactive tax advisor are your best tools.
Making the Most of Your Deductions
Knowing the deductions exist is step one. Maximizing them requires three things:
Track everything. Use a dedicated business bank account and credit card. Categorize expenses monthly, not at year-end. Use accounting software — QuickBooks, Xero, or even a well-maintained spreadsheet.
Plan before year-end. Many deductions require action before December 31. Equipment purchases, retirement contributions, and prepaid expenses all have timing rules. Year-end tax planning isn't optional — it's where the biggest savings happen.
Work with a specialist. A generalist CPA will file your return accurately. A tax strategist will find the deductions your CPA didn't think to look for. The difference is often $20,000–$100,000 per year in missed savings.