If you recently finished your small business tax return, it's not too soon to start preparing for next year. Consider several legitimate deductions you can take as an entrepreneur.
Common deductible business expenses
- Accounting fees
- Advertising and publicity
- Amortization
- Auto expenses for vehicles used for business purposes
- Bad debts that you cannot collect
- Banking fees
- Board meetings
- Building repairs and maintenance
- Business association membership dues
- Business travel
- Charitable deductions made for a business purpose
- Cleaning or janitorial services
- Collection Expenses
- Commissions to outside parties
- Computers, electronics and tech supplies
- Consulting fees
- Continuing education to maintain your professional license and improve skills
- Conventions and trade shows
- Costs of goods sold
- Credit card processing fees
- Depreciation
- Dining during business travel
- Discounts to customers
- Education and training for employees
- Employee wages
- Entertainment for customers and clients, up to 50 percent
- Equipment and equipment repairs
- Exhibits for publicity
- Family members' wages
- Freight and shipping costs
- Furniture and fixtures
- Gifts for customers, up to $25 limit for each gift
- Group insurance
- Health insurance
- Home office
- Interest paid on business loans
- Internet hosting and services
- Investment advice and fees
- Legal fees
- License fees
- Losses due to theft
- Management fees
- Materials
- Maintenance
- Medical expenses
- Mileage
- Mortgage interest on business property
- Moving costs
- Newspapers and magazines subscriptions
- Office supplies and expenses
- Payroll taxes for employees, including Social Security, Medicare taxes and unemployment taxes
- Parking and tolls
- Pension plans
- Postage
- Prizes for contests
- Real estate-related expenses
- Rebates on sales
- Rent
- Research and development
- Retirement plans
- Royalties
- Safe-deposit box
- Software and online services
- Storage rental
- Subcontractors
- Taxes
- Telephone
- Utilities
- Website design and related fees
- Workers' compensation insurance
The Internal Revenue Service does not publish a single exhaustive list of deductible expenses for every situation. Use this list as a starting point and talk with your CPA to make sure the deductions you claim meet IRS rules and apply to your business.
Keep good records so you can support deductions if audited. Save receipts and documents that show the date, amount and business purpose of each expense.
Consider scanning receipts or preserving them electronically since paper can deteriorate, and hold records according to your CPA's recommendation.
For coverage information tied to specific trades and risks, see Small Arms Insurance and Taxidermists Insurance.
For details about property or specialty fixtures, you may also review Plastics Plumbing Fixtures Coverage.
If you have questions about which expenses qualify, review this list with your CPA or talk to an agent for personalized guidance.
Frequently Asked Questions
What records should I keep to support a business deduction?
Keep receipts, invoices, cancelled checks, mileage logs and any documents showing the date, amount and business purpose of the expense.
Can I deduct meals and entertainment?
Meal deductions are limited and often require a business purpose and documentation; entertainment expenses are generally only partially deductible under current rules.
Is a home office deduction available for all small business owners?
You can deduct a home office only if part of your home is used regularly and exclusively for business and meets IRS requirements.