It’s that time of year when most business owners are looking back on their 2023 numbers and trying to uncover possible expenses that could potentially lower their tax bill.

Is this you? If so, let’s dive into the five tax deductions most business owners miss and what you need to know to pay the least amount in taxes, legally possible.

First off, what is a tax write off exactly?

Tax write offs are incentives that the United States government gives to business owners for running a business because your business is helping grow the economy.

It’s the government's way of saying, “Hey, we’re not going to tax you on the money you spent to grow your business!”

And if you are not taking advantage of these tax incentives the government allows, you are overpaying the IRS.

Ok, so what are the most commonly missed tax deductions by business owners like yourself?

Travel

Traveling is an incredible way to grow your business; therefore, the government lets you write off your business travel! Traveling to conferences, meeting with potential clients, researching new areas for real estate, etc., is all business-related travel, so you can deduct it from your income and reduce your tax bill. It’s very important you keep track and document all travel-related expenses. Keep your receipts for your transportation, lodging, meals, etc. Make sure you have downloaded our FREE Travel Guide teaching you how to do this all!

Meals

Speaking of meals, this is another common business expense often overlooked. Most people are aware that meals while traveling for business can be a tax-deductible expense. However, it happens far too often that business owners have meetings or business conversations at a restaurant but don’t use their business credit card for the bill. When you’re at a restaurant, business is bound to be discussed, so as long as the intent of your meal is about business, this makes it a business meeting that can be considered a write off.

Retirement Plan Contributions

Retirement plans offer a range of tax benefits for business owners, making them a brilliant choice if you're looking to save for your own retirement and bring incredible benefits to your employees. Maximizing your own retirement contributions can reduce your taxable income, resulting in significant tax savings—as well as offering retirement benefits to your employees. If you’re a one owner business owner with no employees, a Solo 401k is a great way to get up to a $69,000 deduction while also contributing to your own retirement. A true win-win! This also helps attract and retain talented employees while also providing tax savings for you, the business owner.

Continuing Education

Never underestimate the power of knowledge—especially regarding tax deductions! Business owners commonly miss deducting expenses related to courses, workshops, and conferences that relate to their business and continuing their education. Staying up to date in your industry not only benefits your business but also provides a tax advantage. Again, just remember to keep track of all your fees associated, such as travel costs, registration fees, accommodations, etc.

Interest on Business Loans

Financing your business through loans can have a silver lining – the tax deductibility of interest payments. The interest you pay on business loans is generally tax-deductible, helping you lower your tax bill. Whether it's a loan for a business investment, office equipment, or day-to-day operations, make sure you don’t overlook the interest payments when creating your deduction strategy. Make sure you have downloaded our FREE Biz Basics Guide that will teach you how to dive into all of this!

Maximizing your tax deductions as a business owner uncovers a wealth of opportunities and can help you reach your financial goals faster.

One of the most critical aspects of maximizing your deductions is staying organized and keeping detailed records. Book a call with our bookkeepers HERE.

It’s also important to consult with financial advisors, tax professionals, and experts who can provide invaluable insights tailored to your unique circumstances. Want to see how much we can save you in taxes? Click here to book a complimentary call.