Every tax season we review books from new clients and find the same pattern: deductions the owner was fully entitled to, sitting untracked in a personal card statement or lumped into "Miscellaneous." Individually each one looks minor. Added together on a business netting $150,000, they are usually worth more than the owner expected — and at a 30%+ combined federal and state rate, every deduction left untracked is tax paid that did not have to be.
1. The home office deduction
Owners skip this one because they've heard it "triggers audits." It doesn't — not when the space is used regularly and exclusively for business. The simplified method gives you $5 per square foot up to 300 square feet ($1,500 max) with zero recordkeeping beyond the square footage. The actual-expense method often does better: if your office is 12% of your home, you deduct 12% of rent or mortgage interest, utilities, insurance, and repairs. For a renter paying $2,400/month, that 12% is over $3,400 a year.
2. Business use of your personal vehicle
The IRS standard mileage rate is around 70 cents per mile, adjusted each January. Client visits, supply runs, bank trips, trips to your storage unit — 5,000 legitimate business miles is roughly a $3,500 deduction. The catch is substantiation: you need a contemporaneous log with date, destination, and purpose. A mileage app that runs in the background solves this for about $10 a month.
3. Self-employed health insurance premiums
Sole proprietors, partners, and more-than-2% S-corp shareholders can deduct health, dental, and qualified long-term-care premiums for themselves, a spouse, and dependents — above the line, no itemizing required. A family plan at $1,600/month is a $19,200 deduction. S-corp owners: the premiums must run through payroll and land on your W-2 in box 1, or the deduction is disallowed. This is the single most common S-corp payroll mistake we fix.
4. Retirement contributions you control
A Solo 401(k) lets you contribute as both employee and employer — the combined cap is north of $70,000 per year if your income supports it. A SEP IRA allows up to 25% of compensation with almost no admin. Either way, you're moving money from the IRS's column to your own. The employer portion can be funded up to your filing deadline including extensions, so this is one deduction you can still create after December 31.
5. Equipment, via Section 179 and bonus depreciation
Computers, machinery, furniture, and most software can be fully expensed in year one instead of depreciated over 5–7 years. With 100% bonus depreciation restored and the Section 179 cap sitting at $2.5 million, virtually every small-business equipment purchase can be written off immediately. The mistake we see: assets bought on a personal card and never entered in the books at all.
6. Business meals
Meals with clients, prospects, vendors, or your own team are 50% deductible when business is discussed. What kills this deduction is documentation, not eligibility. Write who and why on the receipt (or in your accounting software's memo field) the same day. A $6,000 annual meals total is a $3,000 deduction — if the paper trail exists.
7. Startup costs from before you opened
You can deduct up to $5,000 of startup costs and $5,000 of organizational costs in your first year (phasing out once totals pass $50,000), with the remainder amortized over 15 years. Market research, pre-launch travel, incorporation fees, early legal work — most first-year filers never claim any of it because the spending happened before the business bank account existed.
Before year-end: a 20-minute checklist
- Measure your home office and pick a method — simplified or actual.
- Install a mileage tracker today; reconstruct this year's log from your calendar while you still can.
- S-corp owners: confirm health premiums are on your W-2.
- Open the Solo 401(k) before December 31 — the account must exist by year-end even if you fund it later.
- Sweep personal card statements for business purchases and get them into the books.
None of this is aggressive tax planning. It's ordinary, well-settled deductions that go unclaimed because nobody is watching the books monthly. That's the actual fix: clean, current bookkeeping, so year-end is a review — not an archaeology dig.