Tax · 8 min read

Small Business Tax Deductions Checklist (2026)

Most small business owners overpay tax not because the law is unfair, but because their books miss deductible expenses they actually paid. This checklist walks the categories your CPA will look for at year-end so nothing slips through.

Operating expenses to capture every month

  • Software subscriptions and SaaS tools used for the business
  • Professional services — bookkeeping, legal, CPA, consulting
  • Bank, merchant processor, and payment platform fees
  • Advertising, marketing, sponsored posts, and lead generation
  • Office supplies, postage, and shipping

Vehicle, travel, and meals

The IRS lets you deduct business mileage at the standard rate or your actual vehicle costs. Pick one method per vehicle per year and stick with it.

  • Business miles with a contemporaneous log
  • Out-of-town travel: airfare, hotel, ground transport
  • 50% of business meals with a documented attendee and purpose
  • Parking and tolls tied to client work

Home office and technology

  • Home office: simplified method or actual expense method
  • Internet and cell phone, business-use percentage
  • Computers, monitors, and equipment (Section 179 / bonus depreciation)
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People and retirement

  • W-2 wages, payroll taxes, and benefits
  • 1099 contractor payments (file 1099-NECs on time)
  • SEP-IRA, Solo 401(k), or SIMPLE plan contributions
  • Health insurance for self-employed owners

Often-missed deductions

  • Startup and organizational costs (up to $5,000 in year one)
  • Business gifts (up to $25 per recipient per year)
  • Continuing education, courses, and trade publications
  • Business insurance: GL, E&O, cyber, workers' comp
  • Bad debts that were previously reported as income

Frequently asked

What is the easiest way to track small business deductions?

Use a dedicated business bank account and credit card, then reconcile monthly. Mixed personal-and-business accounts are the #1 reason real deductions get dropped at tax time.

Do I need receipts for every deduction?

For expenses under $75 (other than lodging) the IRS does not require a paper receipt, but you still need a bank or card record. Lodging always requires a receipt regardless of amount.

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